Since the tragic events of 11 September, a new industry buzzword has inspired both fear and excitement in insurers and reinsurers.

"Bermuda" has been mentioned endlessly by chief executives in lunchtime discussions and general chat in the City bars. It is the big bad wolf threatening to consume London Market business, but it is simultaneously a sunshine island of opportunity and money.

Lloyd's has been losing market share, while overseas centres like Bermuda have been attracting new capital.

The news that senior figures, who originally made their names in the London Market, are increasingly willing to forget their heritage for the tax-free haven rubs salt in an already gaping wound.

Montpelier Re's president, chief executive officer and chief underwriting officer Tony Taylor said that he left behind 20 years of Lloyd's because Bermuda was more efficient.

"While Bermuda has a strong regulatory system which works with practitioners, it is not totally overbearing which can be the case in the UK," said Taylor, former deputy chairman of Wellington.

"Bermuda is a thriving market. It is becoming the key market for many classes of business. That will continue."

Bermuda is not a new concept. It has always existed as a distant threat, but has gained the limelight because of the City's painstakingly slow processing services.

London may not be able to boast such competitive rates and terms because of its history of losses. But, until it changes, the wolf will sit outside the door of One Lime Street.