Bermuda-based insurance executives said the extent of softening market conditions may have been overstated.

As part of a line-up of more than a dozen speakers taking part in the Merrill Lynch Insurance Investors Conference ? held through Wednesday at the Hudson Hotel in New York ? three Bermuda executives said on the first day of the event that each of their companies had managed to maintain a combined ratio under 100, indicating that a profit is being made on business underwritten.

While vouching for the underwriting discipline at each of their respective organisations, the top managers of Endurance, ACE and XL said competition was not as cut-throat as rumoured.

The industry went into a hard market cycle in 2001 ? where rates go up on the back of an insurance capacity crunch ? but some insurance lines started to fall off (or soften) last year.

Endurance president, chairman and CEO Kenneth LeStrange said his company had managed to keep its combined ratio around 90 percent, despite softening market conditions.

Mr. LeStrange was yesterday bullish on the company?s opportunities in this market, saying that while competitive pressure was a variable that could not be controlled, it might actually be lessening.

There was still business that could be written at rates that would be profitable, he said, but conceded that a tight grip was being kept on underwriting.

?There is a clean line-of-sight to every underwriting desk.?

Endurance, one of a wave of reinsurance ventures to set up on the Island in the wake of the 2001 capacity crunch, heightened by the September 11 terrorist attacks, was said by Mr. LeStrange to have, in its short history, ?exceeded all strategic and financial goals? even though the bar had been very high.

He said that strong capital management, on top of ?industrial strength? controls, had been a driver of the company?s success in providing returns for investors.

Although Endurance?s CFO James Kroner said capital management was the ?flavour of the month?, Mr. LeStrange said ?we?ve walked the walk and talked the talk in capital management...since our first six months in business.?

At January 1, when insurers generally see largest renewal of business, Mr. LeStrange said: ?In the main, we saw competitive pressure dampening.?

As for business coming in the door, Mr. LeStrange said: ?We continue to see opportunities ahead of us,? adding that new segments could be added to take advantage of opportunities in areas where the company is not yet involved.

ACE CEO Evan Greenberg reaffirmed the company?s focus as ?an underwriting company. We will, in fact, sacrifice growth for an underwriting profit?.

He said that despite the cost of ?seven catastrophes in seven weeks? in the third quarter of 2004 and a multi-million dollar asbestos charge that, when added together, came to $750 million after tax, the company had maintained a 96.6 percent combined ratio in 2004.

Mr. Greenberg told investors that there were areas where rates had declined so markedly that the company was walking away from writing business. ?We have refocused efforts on underwriting controls.? Mr. Greenberg said, of underwriters, ?do they know you (management) really mean walk away? Do they know that if you have done everything you can do, it is alright.

?They know we pray and worship underwriting,? he said, explaining ?unless new business meets our standards, we won?t write it?.

Mr. Greenberg said pricing may have weakened along some lines, but that terms and conditions were generally holding.

?I would not really call this a soft market, as in the main, prices are adequate...(and) terms and conditions, in the main, have held.?

One of the lines to see significant rate declines is the high excess casualty area, business largely written out of Bermuda.

Mr. Greenberg revealed that ACE was finding any business operated out of a single location ? including ACE?s business in the Lloyd?s of London market and its Bermuda business ? was under pressure. He said ACE Bermuda underwriters had seen rates fall off as much as 50 percent, and they were ?walking away?.

?It is hard to find business that is adequately priced? in the high excess layers, he said.

Two other lines where rates have fallen, Mr. Greenberg said, were energy and commercial property.

On the positive side, he said D&O rate decreases had ?overshot the mark? and were now stabilising, especially in the primary layers ? the first $25 million or so, of coverage.

Although there has been slowed growth in certain lines, and that was likely to continue, Mr. Greenberg said he was ?not overly concerned?.

He said the company?s strict stance on underwriting discipline did not mean that ACE would not aggressively market its products, and that efforts to get information to buyers was likely to increase.

At XL Capital, CEO Brian O?Hara said his company was also governed ?very much (by) an underwriting culture. We look for business where it makes sense, otherwise we play defensively. we look for underwriting margin, first and foremost?.

He added that the company, with a combined ratio from general operations last year of 96 percent despite high storm losses, was ?in a strong position to deliver through the cycle?.

He added that a number of new growth opportunities had been developed in the past year.

He said on the returns side, XL had made a number of strategic investments in asset management affiliates.

?Assets under management have grown $12 billion year over year, in our asset management affiliates.?

He said later the company would continue to build investment affiliates, and maintain careful capital management to meet earnings targets and improve returns.

Mr. O?Hara said XL, which writes both insurance and reinsurance, was expecting rates on the latter side to be ?pretty flattish?.

He said being in both arenas was an advantage for the company as XL was able to ?play off? both markets.

He continued: ?I was generally pleased with January 1 renewals. I was a little concerned in certain markets that it might become too heated in certain areas, but I really didn?t see that. There was some downdrift in aviation and property lines, areas that have really been very profitable throughout the marketplace and it certainly could sustain five to ten percent reductions without really derailing profitability.

?Energy rates were up when we were expecting them to decline,? he said, adding that Hurricane Ivan losses had helped push up rates in this line.

In contrast, Mr. O?Hara said casualty rates had been ?flattish? but not bad, and the recent move by the US Senate to pass class action reform would help the situation. ?We need tort reform in other areas but that is a good start,? he said.

While competitive pressure continued during the renewal period, Mr. O?Hara said storm losses, the backdrop of continued emergence of adverse developments relating to casualty business written in the 1990s, and concerns on reinsurers financial strength, had kept the lid on senseless price-cutting and some were retaining more risk.

He said most major players in the market, including XL underwriters, now had larger net lines. ?I think this is a good thing. When you know you are eating your own cooking, you do a better job in the first place.?

He concluded: ?Some opportunities have diminished but we still believe it is a very sound marketplace but we have our eye on playing defence where competition has increased.?