a bill passed in the House of Assembly late on Monday night.

There were no objections to the Government Employees (Health Insurance) Amendment Act 1999 which had its second and third readings before being passed.

But Finance Minister Eugene Cox admitted the premiums may have to rise to cover the cost of implementing the Bill.

He said it was too early to know whether or not they would face a hike.

The amendment would reduce exposure of the health insurance fund which covers civil servants, retired civil servants, their spouses and dependents.

Mr. Cox said it would allow the fund to purchase reinsurance for all claims over $100,000.

"The cost of reinsurance for those claims from July 1998 forward to March 2000 is $700,000,'' he said.

But a profit-sharing refund would be drawn into the contract so, depending on the claims made, the Government health fund could get up to $175,000 back.

He said for the fiscal year ending in 1998 there were three claims of more than $100,000 on which, if the Government fund had taken out reinsurance earlier, it could have saved $270,000.

But he admitted since July 1998 there had not been a single claim over $100,000.

Shadow Finance Minister Grant Gibbons asked several questions about the legislation but said he supported its principle for which the process had begun under the UBP Government last year.

"Anything like this that puts some sort of catch in the process to take care of bigger claims is good,'' he said.

But he asked whether the move meant insurance premiums had to rise to pay for the reinsurance.

Mr. Cox said he could not say "at this time''.

*** Passenger cabin tax will increase by $2 per cabin onboard, for each day in Bermuda if a Bill tabled in the House of Assembly is passed.

The tax was introduced in last year's budget at $8 per cabin for each night a cruise ship was berthed in Bermuda during the high season, may to August.

It dropped to $4 between September and October and did not apply from November to April.

The new Bill would raise the fees applied by $2.

When tabling the original Bill, former Minister of Finance Grant Gibbons said the tax was needed because passengers were housed and fed aboard their ships.