clarified whe the legislation is tabled in the House of Assembly, Finance Minister the Hon. David Saul said yesterday.

The most significant area of confusion is the definition of related and non-related business, according to a recent edition of trade newsletter Captive Insurance Company Reports (CICR).

Rent-a-captives and where they fit in to the proposed four classes of inurers set out in the regulations were also mentioned.

But dr. Saul said: "Everyone knows until an act is passed there will always be grey areas. No-one has seen the final bill.'' The Insurance Advisory Committee (IAC) will review the bill before it is tabled in the House of the Assembly, he added.

Dr. Saul is anticipating that the bill will be tabled before Christmas but admitted if it does not it will be because of "legal complexities'' in "grey areas'' which could be resolved through "cooperation''.

"We have forged a successful partnership with the private and public sectors.

We wanted something that stood up to international standards but we did not want to overregulate,'' said Mr. Malcolm Butterfield, Registrar of Companies.

"We took their views (insurance companies) into account when proposing legislation. But at the end of the day we put into effect things for the security of the Island the drafting of regulations rests with Government,'' Mr. Butterfield.

The proposed legislation included consultation with "every major insurance sector; managers, brokers, underwriters, each sector was consulted equally,'' he added. "There will be a few (companies) where we will have to consult to define which category they belong in but it will not be a floodgate.'' According to the October issue of CICR, some managers think 15-20 percent of the companies straddle classes.

Confusion apparently arises from the definition of "related and non-related'' business and how premiums from those sources apply to a company. Mr.

Butterfield is expected to consult with other regulators before submitting a definition for the final draft. The definition should determine if a risk is related to a parent or affiliate or not.

Another area of confusion surrounds whether or non rent-a-captives should be class two or class three.

The proposed legislation suggests they should be class three, but Mr. Robert Steinhoff, chair of the Acts, Regulations, Filings and Statistics Committee, which wrote the report on which the draft to parliament will be based, said they might be class two.

CICR suggested if Bermuda is serious about raising solvency requirements, rent-a-captives should be class three.

Another point CICR makes is that there will be a need to increase staff.

But Mr. Butterfield and Dr. Saul indicated this week existing staff levels are a positive, or less bureaucratic, while the latter said in the CICR article there is potential flexibility.

"(Mr.) Butterfield will need the extra staff. Although some managers Insurance rules find him readily available, others grouse that even now they have a hard time getting through to him and that it takes him a long time to return phone calls,'' according to CIRC.

Meanwhile, Government will continue to pursue "quality not quantity'' when it comes to attracting business to the Island, added Dr. Saul on Tuesday at the BII (Bermuda Insurance Institute) PCU (Society of Chartered Property & Casualty Underwriters) Bermuda Market Briefing: From Captives to Cats.

Bermuda's focus is "top drawer companies and as long as I am the Minister of Finance that will continue. Bermuda values the insurance sector,'' he added.

Dr. Saul, said it was not "luck'' or "serendipity'' that brought the Island's insurance industry to the level it is at today, and credited the inclusion of the IAC in the Act as a major force behind the results.

The IAC "vets every company, it vets insurance legislation and regulations and advises on issues, as well as monitoring the behaviour of companies to spot solvency, capital and r manpower problems,'' he said.