But Bermuda, “in order to maintain its position, is going to have to come to grips with a few things,” including the issue of “sustainable development,” he added. “You can't constantly have a new round of companies come to the island and feed off the same resource[s] that [have] been serving the companies that exist–and chase prices higher and higher and higher. Ultimately, if you do that, you will become an uncompetitive environment. Bermuda will hurt itself that way.”

In addition, he noted, ACE supports a global framework of regulatory reciprocity–suggesting, however, that Bermuda falls short of the basic regulatory best practices that will ultimately be adopted.

Drawing a parallel to the banking world, he said the insurance industry, too, is poised to develop minimum regulatory standards. If a country meets the standards, others will recognize it as home country regulator.

“Bermuda, I believe, has to improve its system of regulation. It has to step it up [and] be more vigilant,” he said, inviting more rigorous financial oversight of companies, and more direct involvement in “the areas of risk management and good management governance practices.”

Beyond Bermuda, challenges facing the wider industry come from several fronts, he said, listing catastrophe management, regulatory investigations and asbestos reform among the key issues.

“I think the regulatory investigations will continue to have the attention of the industry,” he added. “While they may not be in the headlines, all that is not behind us yet, and I think the industry will have to continue to manage through that.”

On the issue of asbestos, and trust fund legislation in particular, he said, “for all the naysayers that continually call it dead on arrival, it continues to have life.” He noted that ACE actively supports the process of getting trust fund legislation in Congress. (Mr. Greenberg spoke with NU before a bill creating a trust fund failed to overcome a Senate procedural hurdle last Tuesday.)

“We believe that a trust fund is an efficient solution to this problem, and are surprised that more of our colleagues in the industry don't see it that way,” he said.

Noting that ACE is not satisfied with the current version of proposed trust fund legislation, he said the industry would still be “far better off” with a trust fund than leaving the courts to sort out the ultimate cost of asbestos claims.

High up on the list of challenges for the industry is “a perennial issue–earning an adequate risk-adjusted return on equity,” Mr. Greenberg said. “It's ironic to me that in an industry where, in so many classes, companies judge pricing to be adequate or more than adequate, and prices are being cut, the industry ROE has not, for any period of time you look back on, been adequate for the risks taken. I find that perplexing.”

In its 20th year of operation–2005–ACE reported an ROE of 9 percent, net income of just over $1 billion, and a property-casualty combined ratio of 99.3. The full-year results “reflect the discipline and strength of our company,” he said during an earnings conference call earlier this month–noting, in particular, that net written premiums increased just 2 percent for the year, “reflecting broad-based softening…and our commitment to underwriting discipline.”

During the NU interview, when asked to discuss ACE's competitive advantages, Mr. Greenberg listed the group's global reach–with operations in 50 countries–as well as its breadth of product and financial strength. “The culture of our company…is execution-oriented, disciplined and focused,” he said, contending that others can't match the pace with which ACE responds to opportunity.

Wary of the possibility of giving competitors a road map to success, however, he declined to give much detail on where those opportunities might be in 2006. He did say there is “real opportunity” in the sales of personal accident and supplemental health products internationally, as the middle-class emerges in developing countries and technology increases the likelihood of efficient distribution.

Beyond that, however, he said, “we're always adjusting our strategy as the landscape changes….We look by product, by territory around the world. And for every product, it varies by territory and by customer segment.”