business -- has agreed to buy two insurance organisations.

They include American Excess Insurance Association (AEIA) and Railroad Association Insurance Limited (RAIL).

XL has already acquired the Farmington, Connecticut-based AEIA, which is an association of 13 major US insurers. AEIA specialises in providing up to $100 million in excess third party liability coverage over a minimum attachment point of $25 million.

The deal is based on a percentage of the current AEIA book of business (1995 premiums: $47 million) which will be renewed by XL over the next year through Bermuda intermediaries.

Within 30 days XL is expected to complete the purchase of RAIL, a mutual insurer owned by 12 major transportation companies.

That agreement calls for XL to provide insurance cover to RAIL members and assume liability for losses, while receiving about $50 million in loss reserves, premium and fees.

President and chief operating officer of XL, Robert J. Cooney said, "XL is uniquely positioned to offer a continuation of coverage to the insureds of these two organisations.

"We are confident that we will be able to meet the needs of these sophisticated insureds through our ability to provide the broad coverage terms, large capacity and high level of service that the clients of both AEIA and RAIL have come to expect.

"XL is committed to the excess market and these acquisitions are a key part of our strategic objective to grow our core insurance business.'' AEIA president John A. Traynor said, "We have seen substantial changes in the excess liability market over the last ten years, ranging from availability concerns in the mid-1980s to the highly competitive and growing market of today.

"Now at a time when an expanding marketplace and insurance industry consolidations have produced higher limits and broader product availability, the member companies of AEIA have decided to focus their resources on other areas of the marketplace.

"We believe XL is a world class organisation capable of meeting our policyholders' needs through its competitive products and services, breadth of experience in the marketplace and commitment to customer retention.''