SOME U.S. insurance companies have created their own Bermuda triangle. Instead of ships and planes vanishing without a trace, these companies have figured out how to make their federal tax burden disappear.
American property and casualty companies that insure businesses make their profits not on premiums charged but by investing their reserves. A handful of them have figured out that by reconstituting and headquartering their corporate parents in Bermuda, , their investment earnings can escape nearly all U.S. taxation.
The Bermuda presence is in name only -- often just a storefront office in Hamilton, the island's capital city. The companies' top decision-makers work in the United States, their operations centers are located in the United States and the bulk of thir investments are in the United States.