IPC said its catastrophe losses had pulled down its first quarter net income by $29.6 million or 40 percent, but that losses are having a stabilizing effect on the property reinsurance market.

Jim Bryce, IPC president and chief executive officer, discussed AIG during a conference call in which he responded to an analyst, who referred to AIG as IPC's "ultimate parent" and asked how much business IPC gets from AIG.

"AIG is not the ultimate parent. AIG is one of our shareholders. It's our single largest shareholder. They own 24.3 percent. They have from very beginning," Mr. Bryce said, noting that when the reinsurer was set up in 1993, it did not get business from any shareholder in the first two years.

The company was "not set up to support any of our shareholders," he said. "We were set up to make money for our shareholders."

While IPC does write business reinsurance for AIG business, AIG contracts amounted to only 8-9 percent of IPC's business in 2004, he said. "It's all business that is led by others. It's all placed by brokers. We don't quote or lead any of the business," he said.

"We are happy with our relationship with AIG in terms of the service agreement," he said, referring to the fact that AIG has provided administrative, investment management and custodial services for a fee, since IPC's formation.

(According to the latest annual filing with the SEC for IPC, another remaining link to AIG is that the chairman of the board of IPC Holdings, Joseph Johnson, is also a director and officer of various subsidiaries and affiliates of AIG, including American International Company Limited in Bermuda.)

Although he was not asked, Mr. Bryce went on to say that the IPC has no finite business on its books at all. Finite deals have lately raised red flags because investigators have found that they have sometimes been misused to give a false picture of insurers' reserves by failing to follow Federal Accounting Standards Board rules.

Mr. Bryce also said the firm has none of the contingency fee arrangements with brokers, known as placement service agreements, that have been linked to improper steering and placement of broker clients' business.

"We have passed Sarbanes-Oxley," he said.

IPC net income was $44 million in the first quarter, compared to $73.6 million in last year's first quarter.

The company said it had $20 million in losses for cyclone Erwin, which struck Northern Europe in January. IPC also increased its estimate of its losses related to the Dec. 26, 2004 Southeast Asia tsunami to $9 billion from $1 billion, based on new industry-wide loss figures.

But Mr. Bryce said, "Market conditions are continuing to stabilize," noting that losses in 2004 from hurricanes and from Cyclone Erwin and a large energy loss in 2005 all are having "a beneficial effect" on the market.

As far as property reinsurance market conditions are concerned, Mr. Bryce said that loss-impacted programs are renewing with 20 percent rate increases, while non-impacted programs have generally seen flat renewals.

One exception is in Continental Europe, where programs did see single rate decreases off of stronger prices that prevailed in recent years. Given the significant loss event this year, Cyclone Erwin, where industry loss estimates have been put as high $3 billion, "one would expect underwriters to see need to strengthen rates on renewals," he said.

While catastrophe losses dragged down net income and worsened the combined ratio--which climbed to 63.5, compared to 33.9 in last year's first quarter, Chief Financial Officer John Weale noted that investment income rose 50 percent, to $17.5 million, as the result of a $4.5 million dividend from a hedge fund in which the company invests.