BF&M chief executive officer Glenn Titterton admitted that Bermuda Fire's management relied on potentially inexact financial figures as the company stood at the cusp of its 1991 reorganisation.

But he vehemently denied that he knew of significant risks that insurance policy-holders might not be paid as a result of its split.

The statements came yesterday in Supreme Court on day two of Mr. Titterton's cross-examination by Clare Montgomery QC, the barrister representing liquidators Ernst & Young.

With regard to Bermuda Fire's reserves for its international interests in June, 1991, Mr. Titterton insisted that he had been comfortable to rely on Tillinghast and other professionals to provide the best advice available.

However, in referring to qualifying remarks in the Tillinghast books which advised that a "wide range'' could be expected for the reserves estimated, Ms Montgomery established that Mr. Titterton was aware of no such range.

Ms Montgomery said: "It couldn't make you sure that all the Weavers policy-holders could be paid, could it? You couldn't be sure because, as Tillinghast told you, there was a range.'' "I don't know what else to tell you,'' Mr. Titterton said. "I didn't understand there was a range. They gave us their best estimate figure.'' He said he had understood Tillinghast's reserve estimates to be "conservative'', but agreed with Ms Montgomery that the word itself was not used in the Tillinghast report.

Mr. Titterton also said he relied on accountant Irmgard Viera to summarise the report for him.

Ms Montgomery asked: "Why didn't you say, Look, I want to read at least the whole of the narrative part of it?'' "At the time I didn't feel I needed to,'' he replied.

Mr. Titterton said he did not remember being told that Tillinghast warned of possible increased industrial disease exposure, particularly from asbestos claims.

In light of the "limited pot of money'' set aside for the company's international department, Ms Montgomery suggested to Mr. Titterton that "you would have been wholly failing in your duty not to take account of those claims for asbestos''.

"I just don't remember the subject, to be quite honest,'' he said, adding that he could not recall a specific warning regarding to railroad claims.

Examining Bermuda Fire's annual report for 1991, Ms Montgomery questioned the assertion there that the estimates for costs of claims were "continually reviewed and updated''.

"From your own knowledge, from what you saw and heard in 1991, can you name one person who positively carried out a review of the HS Weavers reserves?'' she asked.

Mr. Titterton said he did not. Nor could he recall such an exercise for the Bermuda London Underwriting Agencies' loss reserves.

Ms Montgomery then reviewed minutes from the board meeting on September 6, 1991, and the financial advice then submitted by Coopers & Lines -- particularly their figures for overseas accounts.

"There wasn't an actuary present at the meeting, was there?'' she asked.

Mr. Titterton agreed that there was not.

"And without an actuary, each and every person at the meeting was making an unqualified estimate?'' she continued.

"I didn't believe that was what was happening at the time,'' Mr. Titterton said. "Again, with eight years' hindsight ...'' "I suggest you realised that in entering into this transaction, there was a real, significant risk that there were policy holders who would not be paid, and you took that risk,'' said Ms Montgomery.

Mr. Titterton replied: "I would have to say, categorically, that is incorrect.''