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LONDONEquitas Ltd. has completed the first phase of a deal with Berkshire Hathaway Inc. that could provide it with $7 billion in reinsurance cover and ultimately end the liabilities of Lloyd's names reinsured into the vehicle.The London-based company, which reinsures the pre-1993 longtail liabilities of Lloyd's of London syndicates - said today that it had completed a reinsurance transaction with Berkshire Hathaway subsidiary, National Indemnity Co., as announced in October last year. Omaha, Nebraska-based National Indemnity has reinsured Equitas' liabilities and has provided an additional $5.7 billion in cover to Equitas. In return National Indemnity will receive Equitas' assets - totalling £4.9 billion ($9.62 billion) as of March 31, 2006 - a £286 million premium from Equitas plus a £172 million contribution from Lloyd's. National Indemnity has also acquired Equitas Management Services Ltd., which will continue to manage the runoff of Lloyd's pre-1993 business.In a statement Equitas said that the deal had received all necessary approvals. The transaction had been approved by the U.K. regulator, the Financial Services Authority, and the New York Insurance Department had approved amendments to the Equitas American Trust Fund that were required to implement the transaction.In an extraordinary general meeting Lloyd's had approved its £90 million contribution to Equitas ($176.84 million). The FSA also approved the return of £50 million ($98.25 million) to Lloyd's names, individual investors that traditionally backed Lloyd's syndicates on an unlimited liability basis. The deal as announced last October is, however, not complete.Equitas will continue to exist and will now work towards a transfer of all liabilities of names into Equitas or a special purpose vehicle, the company said in a statement. Subject to High Court approval, once the transfer of liability from Lloyd's names to a limited liability company is complete, Equitas has the option to purchase a further $1.3 billion of reinsurance cover from National Indemnity.Also under the terms of the deal, the Berkshire Hathaway subsidiary has the option to acquire the company once the transfer of liabilities is completed."If, as we hope, a transfer of liabilities is achieved and foreign courts recognize the transfer, names will no longer have any liability whatsoever under policies presently reinsured by Equitas," Hugh Stevenson, chairman of Equitas said.