Bermuda-based Scottish Re Group Ltd. posted a net loss of $2.71 billion last year, the company announced last night - the biggest loss suffered by any company in the Bermuda insurance sector in 2008.

The life reinsurer, which has ceased writing new business, posted net realised and unrealised losses of $1.9 billion in statements posted on its website last night. Additionally the change in the value of embedded derivatives declined by $216 million.

The net loss breaks down to a loss of $39.63 per share, compared to a net loss of $1.02 billion, or $15.24 per share, for 2007. Scottish Re has suffered huge investment losses and rating agency downgrades in recent years.

In notes attached to its 2008 statements, the company said the continuing deterioration in the US residential housing market - in particularly for sub-prime and Alt-A residential mortgage-backed securities - "likely will continue to have a material adverse effect on the value of our consolidated investment portfolio and our capital, liquidity and collateral position".

The company has cut staff and expenses and sold off non-core segments of its business in efforts to preserve capital and liquidity.