XL Group plc chief executive officer Mike McGavick has dismissed claims that he might be tempted to return to US politics.

A report last month from FBR Capital Markets speculated that XL was an attractive takeover target for larger insurers and suggested that Mr. McGavick, who ran for a Senate seat in the state of Washington in 2006, could have incentives to sell the company and return to politics.

In an interview with The Wall Street Journal, Mr. McGavick said: "By all accounts the Senate race I ran in was a quality race in the wrong year. If you were giving me political advice, would you suggest my next move to be offshore, running a global insurance company? I took this job knowing the answer to that question."

Mr. McGavick succeeded Brian O'Hara at the helm of XL in May 2008. The company was struggling at the time with investments that were negatively impacted by the credit crisis, as well as by its exposure to an affiliated financial guaranty business.

Since then, Mr. McGavick has overseen a turnaround, characterised by a focus on the company's core property and casualty insurance businesses and a "de-risking" of its investment portfolio.

The markets signalled their approval, as XL's share price was the top performer in the S&P 500 Index last year, bouncing back from all-time lows to rise around 400 percent. The shares have climbed a further 18 percent this year.

FBR speculated that a company like Warren Buffett's Berkshire Hathaway or Fairfax Financial could see value in XL's $32 billion investment portfolio or its diversified insurance product base.

"Yes, there has been (M&A) speculation, but we view it as a compliment because we're back on track and being talked about as an insurance company again," Mr. McGavick told the Journal.

On the portfolio restructuring, he said: "The clean-up is overwhelmingly done; we're down to getting some splinters out of the way."

He added: "We want to take what we've recovered and make the best company we can."

And he added that he saw no end in sight to the protracted "soft market". "The reality is that this is a very difficult time in the property and casualty sector as we're in the depths of a highly competitive rate environment, and it's forecast to be that way for an extended period of time," he said.

XL, which moved its holding company from the Cayman Islands to Ireland in July, has substantial operations in Bermuda, based in Bermudiana Road, Hamilton.