Creditor-placed insurance, Mr. Hughes explained, is insurance banks purchase for borrowers, primarily in the homeowners market, until borrowers prove they have purchased insurance.

"We are just a bit dissatisfied," said Mr. Hughes in an investors conference call. "We are in a race. It's not a 100-yard dash, but a marathon. Our goal is not to be in the middle of the pack; our goal is to be a pack leader. We know that is going to take consistent and sustainable performance. We are doing this not just to avoid complacency, but because it reflects the reality that the market is becoming a bit more difficult."

He said his comments did not reflect a softening of the market place, but that Hub's people needed to be more aggressive in finding opportunities for growth. He added that property premium prices now appeared to "flatten out," casualty was continuing to see "single-digit increases," and some specialty lines "at double-digit" increases. However, he noted, "we have seen some markets that have offerings that defy logic."

For the third quarter, net income rose $1.4 million, or 3 cents a share, going to $6.8 million, or 22 cents a share, from $5.4 million, or 19 cents a share, for the three months in 2002. Revenues rose $15.12 million, or 31 percent, going to $64.7 million from $49.6 million.

For the nine months, net income rose $4.8 million, or 23 percent, from 21.1 million, or 79 cents a share, to $25.8 million, or 81 cents a share. Revenues were up $51.4 million, or 33 percent, from $156.3 million to $207.7 million.

Hub said its earning guidance for 2003 would fall at the lower end of its previously released guidance of $1.13 to $1.18 a share.

The firm said this was largely due to the performance of the creditor-placed insurance, which Mr. Hughes said was the result of accelerated cancellations. He said this product sees a normal cycle of cancellations, but because bankers were tightening terms, customers were canceling insurance sooner than normal. He said these policies are primarily written in the Midwest in Michigan and Ohio.

The firm said that without the losses from these policies, the U.S. organic growth rate would have been 11 percent instead of 1 percent.

Hub also said it would pay a dividend of 5 cents per share as of Dec. 30 to shareholders of record as of Dec. 15.