Top 10 fantasy relocations - Wish you were here?

(From Reinsurance)

Deciding on a tax haven is not easy. For a start, none of them like to be called a tax haven. Instead, they are 'low tax' or 'no-tax' jurisdictions - and they have been getting a lot of bad press recently about money laundering, and hiding terrorists' and crooks' money in dodgy bank accounts.

However, the best of these offshore havens rely heavily on their otherwise good reputation for sound financial development, and they have improved their image by bending over backwards to comply with more task forces than you can shake a stick at.

The International Monetary Fund (IMF), the Financial Action Task Force (FATF), the Organisation for Economic Co-operation and Development (OECD) and the European Union (EU) have all been gunning for the small, wealthy offshore jurisdictions that have been luring American- and European-established companies and wealthy individuals away with the spectacular tax savings they offer.

It is unclear just how much is saved from exchequers around the world by shifting offshore, but a recent survey by Tax Justice Network, a group of accountants and economists concerned at the escalating wealth held in offshore locations, said the world's richest individuals have placed a whopping $11.5trn of assets in offshore havens, mainly as a tax-avoidance measure. Considering that this figure is almost as large as the US' GDP, imagine the savings corporations can make - which is why shareholders have been rattling cages in the US to make sure companies move offshore to save cash.

However, this can be controversial. In the US, the public sees moves such as Ingersoll Rand's recent relocation in Bermuda as 'unpatriotic'. Nevertheless, the folks at Capitol Hill seem powerless to prevent it - and insurers such as White Mountain (which recently relocated to Bermuda) have not been slow to follow.

Moody's Investors Service in New York has backed offshore American corporations. It is said that despite certain risks, offshore reinsurers can offer a complementary alternative to onshore reinsurance. The rating agency cited advantages to offshore reinsurance - primarily the Bermuda and Barbados markets - if used in moderation and with treaties that are appropriately structured and secured through well-capitalised, well-diversified insurers.