Mr. Oxendine spoke Saturday at the annual National Conference of Insurance Legislators meeting in Duck Key, Fla. He said any revision of reinsurance regulations will focus on four areas:

?Enhanced reporting for the reinsurance companies.

?More attention to ensuring cedants' credit and reinsurance reserves match.

?Mechanisms for reducing disputes between insurers and reinsures.

?Ensuring any savings gained by the reinsurer through these methods will be passed on to the cedant.

For the past several years representatives of alien reinsurers have urged creation of a so-called "white list" of sound companies that would not be subject to the 100 percent collateralization requirement.

But the domestic industry, backed up by the regulators, has fought off such measures as a threat to the financial solvency of the industry should a reinsurer fail to live up to its obligations.

Last year both sides agreed to meet with New York Insurance Commissioner Greg Serio in an attempt to come to some agreement to allow the alien companies to compete in the U.S. market without the collaterization requirement. Since that time an ad hoc group of nine commissioners has been discussing the issue with both sides in the dispute.

But Mr. Oxendine said it has now become apparent that the two sides are too far apart to come to agreement on their own.

Just how these measures will turn into reality remains unclear at this point.

While amending the credit requirement for the reinsurance model is one possibility, that could be a cumbersome process that would result in non-uniformity for a time.

Instead, North Dakota Commissioner Jim Poolman said the setting up of an office modeled on the National Association of Insurance Commissioners' Securities Valuation Office could ensure both domestic and alien reinsurers operate on a sound financial basis.

In a letter signed by nine commissioners to the primary and secondary trade organizations, emphasis was put on the fact that collaterization would no longer be required on a geographic basis.

"Credit for reinsurance should be based on principles of safety and soundness rather than geographic location," the letter stated.

Mr. Oxendine raised the possibility that under the new format some domestic reinsurers could face collaterization requirements.

On the face of it the proposed new rules would appear to be a victory for the alien reinsurers.

David Matcham, of the London-based International Underwriters Association, said the new rules reflect his group's contention that location has nothing to do with fiscal soundness.

But any implementation is still a long way off. The ad hoc commissioners' panel will review comments over the next several weeks and only then will a final proposal be presented to the Reinsurance Task Force of the NAIC for consideration.

Meanwhile, regulators will check the progress with two separate international panels looking into collectability of judgments and international accountings standards, as these are critical issues in creating a truly global reinsurance marketplace.

But, Mr. Poolman said that any new reinsurance regulatory regimen will not depend on these two panels completing their tasks.