(RVI), declared net income of $2.8 million on net written premiums of $11.3 million for the year to December 31.

At year's end, RVI maintained total stockholders' equity of $103.7 million and total assets of $145.6 million.

The strong results led ratings agency Fitch IBCA to rated RVI's claims paying ability `A', reflecting, it said, RVI's market dominance, strong underwriting history, conservative capitalisation and strong parental support.

RVI's capital increased markedly from $77.4 million in 1996, due to the net effects of Continental Casualty's purchase of a 50 percent interest in the company.

Fitch IBCA said RVI's historical operating performance is compelling. Losses paid and accrued since inception have been limited to $9.3 million on cumulative premiums of $65.1 million, a 14.2 percent ratio.

RVI underwrites residual value insurance on a worldwide basis. Residual value insurance protects against a catastrophic decrease in asset value. It offers asset owners insurance on the market value of certain insured assets at specified points in time.

But Fitch IBCA did have some concerns. They included recent losses in the company's aircraft line, risks associated with recent expansion into real estate lines, increasing concentration among key insureds and the potential for diminished market leadership with other companies already entering the market on a strategic basis.

Total insurance in force at the end of the 1997 fiscal year was some $3.09 billion, with forecast portfolio value at the corresponding maturity dates of $7.42 billion.

The insurance is purchased by asset-based finance transaction participants, generally banks and finance companies, often to fulfil an accounting treatment requirement or facilitate transaction structuring needs for the secondary market.

RVI focuses on four lines of business. For the 1997 year, 67.1 percent of the business was passenger vehicles, 21.9 percent commercial equipment, 6.2 percent aircraft and 4.6 percent real estate.