ERROR RG P4 21.12.1994 A Supreme Court story in yesterday's Gazette incorrectly made reference to the Bermuda Fire & Marine Insurance Company when it in fact meant BF&M Insurance Co. Ltd.

In the largest insolvency of a Bermudian insurance company, troubled Bermuda Fire & Marine Insurance Company (BFMIC) was yesterday ordered into liquidation by the Supreme Court.

The development came after provisional liquidators reported that the net worth of the company could be more than $130 million less than what was previously believed.

Under the terms of the order, provisional liquidators, Mr. L. Anthony Joaquin, a partner of Ernst & Young in Bermuda, and Mr. Gareth H. Hughes, a partner of Ernst & Young in London are to remain in office as provisional liquidators, pending the first meeting of the creditors.

Mr. Joaquin reported to the court that minimum adjustments to BFMIC's surplus, previously reported at December 31, 1992 as $4 million, in the amount of $30 million rendered the company materially insolvent.

The joint provisional liquidators believe that further adjustments of $100 million or more may be necessary once the company's loss reserves are actually reviewed.

Mr. Joaquin also noted that previous hearings to consider the liquidation of the company had been adjourned while the joint provisional liquidators and their advisors considered whether a scheme of arrangement to run off BMIC's liabilities could be conducted within a liquidation. It was confirmed through the direction of the court on December 1, 1994 which led to the winding up order being sought yesterday.

The order from Acting Chief Justice, the Hon. Mrs. Justice Norma Wade, comes 13 months after shareholder and director Mr. William Cox, first petitioned the court for the appointment of provisional liquidators.

It was Mr. Cox again who requested of the court yesterday that the BFMIC be put into liquidation.

Mr. Cox, who had presented his petition because management accounts had indicated that BFMIC was unable to meet its minimum statutory capital requirements, noted that the joint provisional liquidators had concluded that BFMIC is materially insolvent.

He was represented by lawyer Mr. John Riihilouma, who said later: "It is now up to the liquidators to realise the assets and act on behalf of the creditors.'' A full report to creditors of BFMIC will be released by the joint provisional liquidators in January.

The application was supported by seven creditors of the company, who have substantial outstanding claims.

They include Transit Casualty, a Missouri based insurer in receivership under the weight of $4 billion in liabilities. The company was represented in court by lawyer, Mr. Nigel Howcroft of Appleby, Spurling & Kempe. Mr. Delroy Duncan was in court representing ITT Hartford Insurers Group, International Insurance Company, GAS Corp,. Certain Teed Corp., United States Gypsum Co. and Asbestos Claims Management Corp.