several years of heavy losses, according to a top Lloyd's underwriter.

Mr. Stephen Burnhope, lead underwriter of Lloyd's syndicate 1212, said the introduction of fresh corporate capital was a major vote of confidence in current underwriters, as Lloyd's was emerging stronger out of recent problems that would have shut down large insurance companies.

Mr. Burnhope was in Bermuda to speak at the Second Producer conference at the Belmont Hotel hosted by Gibbs Harnett and Richardson International Ltd. and Financial Institutions Insurance Services, a member of Lloyds brokers, Gibbs Hartley Cooper group.

Speaking at the four day conference, Mr. Burnhope emphasised that despite Lloyd's bad press over heavy claims from the late eighties and early nineties, Lloyd's remains a leading light in the industry.

Mr. Burnhope, speaking to 21 selected independent retail insurance brokers, said that even with fewer syndicates, Lloyd's 1994 capacity had been raised to 10.9 billion, (US$ 16bn) having previously dipped for 1992 and 1993.

The Lloyds plan had included the scheme to attract corporate capital, revisions to the regulatory structure, the establishment of "NewCo'' to deal with old claims, creation of more efficiency and consolidation, together with reductions in costs and fees.

NewCo is being established as a limited liability reinsurance/run off company to reinsure syndicate liabilities that pre-dated 1986.

Lloyd's, although badly hit by US losses, through natural catastrophes and longtail liabilities, would continue to operate in the US, the underwriter assured.

He forecast that the reduction in the number of syndicates will continue, having shrunk from 388 in 1990 to 179 active syndicates this year. This resulted from weaker support for smaller and less profitable syndicates, leading to some shutting down and others merging to form stronger operations.

Mr. Burnhope was formerly with the Merrett Underwriting Agency, one of Lloyd's best known agencies before it disappeared from the list for 1994.

It too, was a victim of past liabilities, as Lloyds waited for the fittest to survive.

Mr. Burnhope, seen as a leading light in the Lloyd's underwriting community, underscored how varied market results were for even loss-making years like 1990 and 1991.

For example, marine losses represented more than half of losses in 1990 and 115 out of 388 syndicates that were actively underwriting that year actually made money, totalling more than 171 million.

Two thirds of current capacity is controlled by syndicates that were profitable in 1991.

Mr. Stephen Burnhope.