My law firm represented Quality Insurance, the Bermuda company that had written my father's policy.

Following the war the bank experienced rapid growth, increasing its number of shareholders by 42% and thus becoming the largest Bermuda company in terms of shareholders.

The Bermuda companies also sold large liability policies directly to American corporations.

When an American company reorganizes as a Bermuda company, the change is treated for tax purposes as a sale.

Bermuda companies that merely sell reinsurance to independent American firms would not be affected.

"Shareholders of Bermuda companies do not generally have rights to take action against directors or officers of the company, and may only do so in limited circumstances."

'And you're sure that this Bermuda company controlled by you will lend me the half-million pounds in cash to buy these shares, at no interest?'

For example, regulators say, Reciprocal shifted $112 million through a Bermuda company to General Re to pay claims.

But a close reading of the law showed that it explicitly allowed American subsidiaries of the Bermuda companies to hold federal contracts.

It has proposed to its shareholders an incorporation as a Bermuda company that would have its legal residence in Barbados.