eighth year of increasing financial strength with total assets and shareholder equity rising to record levels.

OCIL's total assets rose 17 percent on 1997 results to $733.2 million, while year-on-year shareholders' equity (capital and surplus) increased by 11 percent to $492.1 million.

Total premium income decreased by 27 percent from $36.6 million in 1997 to $26.6 million.

But total expenses were also down 32 percent and reductions in loss expenses offset increases in investment fees and acquisition costs.

OCIL president and CEO Jon King said 1998 was a year of unprecedented achievement for the company with net income of $80.6 million setting a new record for the company and showing a big jump on 1997 results.

"This record performance was achieved despite an operating environment marked by depressed premium rates and increased investment market volatility,'' he said.

"This is a further indication of the strength and security that has evolved in OCIL.

"We are fortunate to have experienced an extended period of no paid losses and have benefited from three years of solid investment performance with an annualised equity return of 19.3 percent.'' OCIL chief operating officer Jack Wesley said the company's claims-paying ability continued to improve and currently provided for the potential payment of more than eight $100 million losses in one policy year.

He said policy changes approved at last week's AGM included broader coverage for UGL war risk, floating storage vessels, secondary products recall and property damage to chartered vessels.

OCIL began operations in Bermuda in 1986 when 14 energy companies joined together to form a company which would provide catastrophic insurance coverages to members of the energy industry.