Bermuda-based Catlin Group Limited will establish a reinsurance company in Switzerland to expand its European-based reinsurance business, the company announced.

The international specialty property and casualty insurer and reinsurer said it has applied to the Swiss Financial Market Supervisory Authority (FINMA) to establish Catlin Re Switzerland.

As European market conditions improve, the company said that it will expand its portfolio of treaty reinsurance business, particularly concentrating on risks and areas of distribution that are not currently underwritten elsewhere within the Catlin Group.

The company said Catlin Re Switzerland will have capital of at least $1 billion from internal resources and will initially underwrite specialty reinsurance business "for which market conditions are favorable."

These classes of business include trade credit reinsurance, political risk reinsurance and surety reinsurance.

Catlin said it will also apply to the Bermuda Monetary Authority to establish a Bermuda-based branch of Catlin Re Switzerland. The Bermuda branch will initially underwrite reinsurance of various Catlin Group subsidiaries that is currently written by Catlin Insurance Company LTD.

Catlin began its European expansion in 2003 and now has ten European offices.

Catlin Re will build on the existing book of reinsurance business that has been developed and underwritten by Catlin's European offices, the company said.

The company noted that Catlin's existing Bermuda portfolio of open market insurance and reinsurance will continue to be underwritten by Catlin Bermuda.

Paul Brand, chief underwriting officer of the Catlin Group, will assume the additional role of chief executive officer of Catlin's European Operations.