Alterra Bermuda, part of Alterra Capital Holdings, has received approval from the State of New York Insurance Department (NYID) to qualify as an eligible reinsurer for reduced collateral status.

The status allows reinsurance companies that are not based in the US to maintain lower collateral requirements for non-domestic reinsurers that are highly rated and financially secure.

Alterra Bermuda said that it will be now able to post collateral for 20% of property and casualty reinsurance loss reserves in New York rather than the 100% required by most non-US reinsurers.

Alterra Bermuda was previously received similar status as an eligible reinsurer for reduced collateral by the State of Florida.

The approval process requires reinsurers to have capital and surplus of at least $250m, show proof of financial strength by at least two rating organizations, and provide evidence of financial soundness and stability.

Alterra said New York is among a small group of states within the US to adopt this rule which lowers the barriers of entry into the market for non-US reinsurers.