Bermudian Brian Duperreault has been appointed as chief executive officer of Marsh & McLennan Co. s, the world's biggest insurance brokerage.

Mr. Duperreault enjoyed a spectacular career in Bermuda, especially as chairman and CEO of Ace Ltd. from 1994 to 2004, an era in which the company expanded into a global player and increased its market value fivefold. He served as Ace chairman from 2004, until he stepped down last year, but he continued as a director.

Ace announced yesterday that Mr. Duperreault had stepped down from the company's board. According to regulatory filings, Mr. Duperreault has been reducing his holdings in the Bermuda company, having sold at least 100,000 Ace shares in October and November.

Mr. Duperreault is also the chairman of Butterfield Bank, a post he took on last April.

Asked whether Mr. Duperreault would continue in the role, a spokesman for the Bank wrote in e-mailed statement: "The Bank is pleased that its non-executive chairman has been appointed to such a major position and it will be business as usual for us."

He is also chairman of The Centre on Philanthropy and chairman of the Bermuda Institute of Ocean Sciences.

Now the 60-year-old, who succeeds Michael Cherkasky as CEO, faces arguably the biggest challenge of his stellar insurance career at a vast global company that operates in more than 100 countries.

Marsh has struggled to recover since becoming embroiled in a bid-rigging scandal following former New York Attorney General Eliot Spitzer's in-depth investigation into the insurance industry. Former prosecutor Mr. Cherkasky helped to guide Marsh through the aftermath of the scandal, improving the company's relations with regulators, but was ousted last December after three years at the helm of Marsh, after he failed to regain the clients and profits lost after the scandal.

The selection of industry veteran Mr. Duperreault could be seen as a feather in the cap of the Bermuda insurance industry. And it went down well with some analysts.

"This takes a lot of pressure off management to do something quickly," said Meyer Shields, an analyst with Stifel, Nicolaus & Co. in Baltimore. "He is somebody who could serve as a beacon to attract talent and keep the talent that has been leaving Marsh under the current confused management." In a note to investors, Mr. Shields said: "We frankly cannot imagine a better choice."

"It's a great hire," said Mark Lane, an analyst at William Blair & Co. Duperreault led Ace "through a tremendous transformational period from a specialty company to global player".

But Goldman Sachs analyst Thomas Cholnoky did not believe Mr. Duperreault's appointment would have an immediate, warning in a research note: "We would be sellers of the stock into any strength ... as 2008 results should continue to be disappointing."

Marsh's stock price rose more than two percent by mid-afternoon, but took a fall late in the day, ending down by 19 cents, or 0.69 percent, at $27.17 in New York Stock Exchange composite trading.

Rumours have circulated that London-based Willis Group may be trying to take over Marsh, but some commentators suggested Mr. Duperreault's appointment would quash those rumours.

Evan Greenberg, the Ace Ltd. CEO who succeeded Mr. Duperreault, praised his former colleague and told Reuters he had transformed Ace from a "small niche Bermuda player to a global property and casualty powerhouse".

"This industry needs a strong, healthy and vital Marsh focused on what it does best," Mr. Greenberg added. "I have no doubt Brian will help to ensure that."

Mr. Duperreault said that there would be "no quick fix" at the brokerage and told Bloomberg: "Marsh hasn't been performing to the degree it should. Our margins aren't competitive."

Marsh has come under pressure to sell off parts of its operation, such as its Mercer human resources and Oliver Wyman consulting units and Kroll investigations arm, with analysts suggesting the group would be stronger without them. Mr. Duperreault said on the subject: "First things first: Let's get them all operating at peak efficiency."

Mr. Duperreault, 60, presided over more than a half-dozen acquisitions at Ace, including the 1999 purchase of Cigna Corp.'s property and casualty insurance division for $3.45 billion.

Before joining Ace, he worked for more than 20 years at American International Group Inc., the world's largest insurer by assets, rising to become head of the unit handling AIG's commercial business outside the US.

Mr. Spitzer's bid-rigging probe led to the demise of former Marsh & McLennan CEO Jeffrey Greenberg and Mr. Cherkasky was left to reach an $850 million settlement.

But the financial damage continued as Marsh & McLennan had to forgo about $845 million a year in payments from insurers that Mr. Spitzer had labelled "kickbacks". The probe also hurt the company's reputation and scattered Marsh's customers at the same time that falling prices for commercial insurance reduced commissions for helping corporations find coverage.

According to a Business Insurance magazine survey, Marsh is the world's top broker by 2006 brokerage revenue, having generated $10.5 billion in revenue ahead of Aon Corp.'s $6.71 billion and Willis Holdings' $2.34 billion. However, Marsh was surpassed by Aon in terms of market capitalisation this year.