$477.2 million for the six months ended June 30 after additional claims were reported to the company and its estimate of reserves for accrued losses was increased. Last year the company reported earnings of $278.5 million for the same period.

Despite a "strong'' balance sheet and improvements in reinsurance pricing, OPL said it expected pricing imbalances to stifle improvement until at least 2001. The company will nevertheless pay a 60 cent dividend to shareholders of record on August 10.

"The reserve strengthening relates primarily to business written from 1997 to 1999 across each of our lines of business,'' said Mary Hennessy, OPL's CEO, "and reflects significant additional claims reported to OPL in the second quarter and our assessment of prevailing conditions in the reinsurance market.'' Gross written premiums decreased to $464.5 million for the six-month period, compared to $635.8 million in the same period last year. OPL attributed the decrease to the cancellation of the shipper's risk programme and discontinuation of marine, property, accident, health, aviation and multi-line programmes that did not meet the company's return on capital requirements.

The results also indicate a net underwriting loss of $478.9 million in the first six months of 2000 compared to income of $177 million in 1999. The cancellation of the UPS shipper's risk business, worth $116.4 million in underwriting income during the first six months of 1999, was a significant contributor to the loss, according to OPL.

The company's insurance investments produced a loss of $9.3 million during the six months, compared to an income of $159.7 million for the corresponding period in 1999. OPL's real estate interests generated operating income of $7.9 million during the period, an increase over the $5.8 million from the first six months of 1999.

Total assets at June 30, 2000 were approximately $5.0 billion. OPL's release said the company was "encouraged'' by the success of its relationship with Renaissance Re to write property catastrophe business. The company is also in the process of acquiring Reliance Reinsurance Company of Philadelphia.