million court action being brought in Texas State Court in Dallas County.

The action was filed on January 29, 1993, by US chemicals manufacturer Hoechst Celanese, whose captive insurance firm, Elwood Insurance, is managed by IRM.

The lawsuit stems from a huge fire/explosion at a Hoechst Celanese commodity chemicals plant in Pampa, Texas, in November, 1987, which killed three people.

Hoechst Celanese has already set tled an action against Elwood and reinsurers for a sum believed to be in the region of $507 million.

But Ms Andrea Stine, a spokeswoman for Hoechst Celanese, said: "The amount we recovered was substantially less than the losses incurred.'' Although she would not reveal the total amount, The Royal Gazette has been told Hoechst Celanese is claiming another $100 million.

It is seeking the amount from Bermuda-based IRM Group Ltd., its subsidiary IRM (Bermuda) Ltd., IRM's American affiliate American Risk Management, loss adjusters GAB Business Services, and MK-Ferguson Company, the engineering firm hired by GAB to assist in the adjustment process.

Hoechst Celanese is alleging that IRM and the loss adjusters mismanaged the settlement of the insurance claim, which resulted in the "gross under-calculation of claims, extensive delays in adjustment and increases in costs and injury to Hoechst Celanese's name and reputation in the marketplace''.

In addition, Hoechst Celanese is alleging that the "wrongdoing of the managers was as a result in part of its conflicting obligations as manager of both the insurer and principal reinsurer'', said Ms Stine.

Nobody at IRM, which is majority owned by Zurich-based Swiss Re, was available for comment yesterday.

Mr. Donald Westmorland, deputy chairman of IRM (Bermuda), failed to return two messages, Mr. Graham Brice was off work ill and Mr. Art Deters, chief executive officer of IRM, did not immediately return a message.

An insider in Bermuda's international insurance industry said: "This is regarded in the industry as a pret ty big claim. But they have insurance to cover this sort of thing. It's more of a name harming thing than anything else.'' IRMG operates an unusual reinsurance facility which gives it an unbroken connection from the insured all the way down to the worldwide reinsurance market.

It manages the Hopewell pool of reinsurers which reinsures their captives and manages the negotiations with public reinsurers. One of the advantages of the system is that it gives them virtually unlimited capacity.