Six years after the failed Bermuda-based reinsurer Stockholm Re (Bermuda) Ltd.

went into liquidation, creditors have been paid out 20 percent of their claims.

But it could be another 18 months before another payment is made and the matter settled once and for all.

Stockholm Re first hit trouble in the early 1990s, and by 1995 had been forced into liquidation.

In 1996, liquidators told brokers, policyholder and potential creditors that almost $5 million had been collected from the reinsurers, but warned it could be years before any settlement was made.

Mark Smith, David Morgan and James Smith of Deloitte and Touche are joint liquidators for the property, marine and aviation reinsurer which entered run-off and ceased writing business in March 1994.

In a statement the liquidators said: "Acting as liquidators from Stockholm Re (Bermuda) Ltd. in consultation with the creditors committee, are pleased to announce payment of a first dividend in the amount of 20 percent on all aggregate scheme claims. For creditors in the scheme of arrangement whose claims have been agreed by the liquidators, payment of the dividend will be made by June 2001.'' When asked by The Royal Gazette when the liquidation process would be complete, the company said: "There is another dividend expected in the next 18 months. We cannot predict when it is going to end because of outstanding issues.'' The spokesperson would not elaborate on what the outstanding issues were in connection with the liquidation.

Formerly National Underwriters (Reinsurance) Ltd. when first set up in 1979, Stockholm Re in 1990, was a 100 percent subsidiary of Stockholm Reinsurance Company Ltd., a Swedish company owned by Lansforsakringsbolagens AB.

The company had been licensed to accept all types of insurance and reinsurance business except for product and professional liability. Stockholm Re targeted reinsurance of property and marine business, mostly originating from the London market.

Like other property and marine reinsurers, the company took huge losses between 1988 and 1994, involving well known catastrophes such as Piper Alpha, Atlantic Richfield, Phillips Petroleum, Cat 90A, Hurricane Andrew and the Northridge Earthquake. They all generated significant retained losses. They were exposed to Lloyd's personal stop loss policies for the 1989 and 1990 underwriting years.

Since its inception, Stockholm Re generated underwriting losses of about $174 million on gross premiums written of about $539 million. The company ceased writing business at the end of December 1993 and was placed in run-off the following March.

Collapsing under a weight of debt, spurred on by a $16 million claim during December 1994, Stockholm Re was then placed into compulsory winding up at the start of 1995.

In 1996 International Loss Recovery Services (ILRS), a unit of Alexander Howden Group Claims Consultants, was the sole collection agent.

The first phase of their work included the transfer of documentation and records from brokers, accounts reconciliation and a file audit. ILRS has also created policy and accounting records, implemented credit control monitoring and payment transfer systems to accommodate full security breakdown.