Finance chief quits Alea amid profits slide

Alea Group, the Bermuda-based insurance company, pushed on with its boardroom purge yesterday, announcing the resignation of its chief financial officer, Amanda Atkins - the fourth board member to leave in less than a year.

Alea Group, the Bermuda-based insurance company, pushed on with its boardroom purge yesterday, announcing the resignation of its chief financial officer, Amanda Atkins - the fourth board member to leave in less than a year.

Since taking over as chief executive from Dennis Purkiss 12 months ago, Mark Ricciardelli has overhauled his executive management team in an effort to turn around Alea's ailing fortunes. Alea has also replaced its US chief executive officer and group chief underwriting officer within the past year.

Announcing its full-year results for 2004 yesterday, Alea reported an 80 per cent drop in pre-tax profits to $10.9m (£5.7m). These were aboveanalyst predictions, which ranged from a loss of $22m to a profit of $9m. The sharp fall in profits was mainly due to a $72.5m gap in Alea's claims reserves on its older insurance book. It was also forced to book a loss of $51.4m from the hurricanes in the US and Caribbean last autumn - the worst storm season on record.

The group's combined ratio - a key measure of an insurer's profitability - declined over the year from 96.8 to 104.2 per cent. A ratio below 100 represents profitability, while above 100 represents loss-making business. Commenting on the results, Mr Ricciardelli said: "We have completed our rigorous global reserve review, which led to a second-half reserve increase of $73m, in line with our previous guidance.

"We believe ... prospectively our risks and opportunities are balanced. We remain committed to our long-term goal of a 12 to 15 per cent cross-cycle return on equity. I believe our underlying performance, along with our reserve actions, place us in a stronger position as we move towards this goal in 2005."