Lloyd's of London insurer Amlin saw gross written premium, before deduction of brokerage, fall by five percent to £1.03 billion ($2 billion) in 2007 but remains confident it can cope with more difficult trading conditions.

"Premium income was modestly lower but the claims environment was benign and investment returns were strong," chief executive Charles Philipps said.

Amlin Bermuda Ltd. is part of the Amlin Group.

"The underwriting environment in 2008 is softening as expected but good margins exist for selective underwriters," he added.

"This year so far Amlin has written total income (before deduction of brokerage) of £298m, down seven percent on the previous year. Overall renewal rates for Amlin have declined by eight percent with a retention ratio of 87 percent. We believe that at these rating levels we continue to write business which will produce an acceptable return," Phillips added.

Fourth-quarter investment returns were 1.9 percent, principally driven by strong bond returns of 2.4 percent.