Insurance executives agreed this week that pay levels should be tied to company performance ? and said they should be the first to have their wages cut when their companies post poor results.

The executives, who were taking part in a panel discussion at the World Insurance Forum at the Fairmont Southampton Hotel this week, said it was not always easy however to link pay and performance.

Swiss Re CEO John Coomber said he thought there should be a connection between shareholder returns and compensation levels but the real challenge was to figure out how one was doing with accounting figures out of date by the time they were received.

?We need to be able to gauge underwriting performance right now and find a way of adjusting compensation as a reflection of performance,? he said.

Brian O?Hara ? who could be said to be leading by example after he took a 60 percent pay cut last year because of a huge reserve charge in the fourth quarter related to past business written by XL?s US-based reinsurance arm ? said return to shareholders was very important but cautioned that it should be looked at over a period of time.

?It is very complex to evaluate how you are doing in any one particular year, but certainly a big driver is performance,? he said.

Chairman and CEO of top broking firm Willis, Joe Plumeri, said pragmatically: ?Compensation gets complicated but I think it should be simpler. It should depend on how well the company does.?

And he added that if the company does well it should be reflected throughout the organisation.

Allied World Assurance Company (AWAC) vice-chairman Michael Morrison agreed that compensation should be a reflection of performance.

?First of all, there is how the company does. If you have a profit than you can do something.

?But it starts with people. We are a people business. We don?t make widgets,? he said, adding that employees should be rewarded when a company does well. But when pay cuts need to be made, it should start with the CEO first,? he concluded.