Bermuda-based OIL Insurance Ltd. has announced record breaking growth in terms of membership, gross assets insured and expansion of coverage across the energy industry for 2001.

President and CEO Jack L. Wesley said at the company's AGM on Friday that in a year unsurpassed over its 31-year history, 16 energy companies became new members of OIL during 2001, resulting in an all-time high of 63 energy companies obtaining property damage and pollution liability insurance coverage from OIL.

In addition to membership growth, Mr. Wesley also reported that total gross assets insured reached a record level of $1.2 trillion, easily surpassing the previous record high of $900 billion at the end of 2000.

With the expansion of eligibility in 2001 to include the broader energy industry (from the previous focus on petroleum companies exclusively) the shareholders were informed that for the first time OIL gained membership from electric utility, mining and chemical companies within the broader energy industry.

"This is not growth for growth's sake", said Mr. Wesley. "This has been a focused, strategic effort on the part of OIL. By including these types of companies, we are diversifying the risk to our overall membership and ultimately reducing the volatility of our operating results."

The insurance limits offered by the company remained stable throughout the year and Mr. Wesley pointed out that this is in sharp contrast to the reduction or even elimination of coverage for energy companies from the commercial insurance market resulting from major losses prior to and stemming from the tragic events of September 11.

Mr. Wesley also said that with a $250 million per occurrence limit and up to $1 billion for a single event loss, OIL continues to offer among the largest limits, net of reinsurance, of any major insurance company in the world.

For only the third time since 1992, net underwriting income was recorded as a loss, $438 million for 2001.

Douglas A. Kline, senior vice president and chief operating officer commented: "We've had an incredible decade of extremely low losses and high net income for OIL.

"So a year like 2001 is not only fully anticipated, but the company is more than adequately capitalised to handle and above average loss year with absolutely no disruption of limits, coverage or service levels."

He also said that two losses accounted for 70 percent of the total for 2001.

Mr. Kline also said that rates for the new year, as predetermined by the company's cornerstone rating and premium plan, immediately adjust to fully recover any losses in successive years.

Even with the results of the past year, Mr. Kline said that capital was more that adequate to pay a $100 million dividend to shareholders in 2001.

Shareholder equity was in excess of $1.3 billion at the end of the year while total assets exceeded $2.8 billion.