Argus Group Announces Half-Year Results To September 2004

Hamilton, Bermuda: 25 November 2004 - The Argus Group today announces earnings of $8.73 million for the six months ended September 30, 2004 compared to $4.87 million for the corresponding period in 2003.

UNAUDITED SUMMARY OF CONSOLIDATED STATEMENT OF OPERATIONS

FOR THE SIX MONTHS ENDED SEPTEMBER 30, 2004 (in Bda$000's)

                                            2004         2003

      Premiums (net of reinsurance)   $   44,740  $    37,898

      Investment income                    9,047        9,404

      Commissions & management fees        6,278        4,808

                                          60,065       52,110

      Claims & benefits                   39,935       37,832

      Operating expenses & commissions    11,396        9,405

                                          51,331       47,237

      Earnings for the period         $    8,734  $     4,873

      Earnings per share

           -basic                     $     1.21  $      0.67

           -fully diluted                   1.18  $      0.66

Earnings of the Group returned to more expected levels in the six months to September 30, 2004 compared to the corresponding period in 2003. Gerald Simons, President & Chief Executive Officer, the Argus Group, says: "We are delighted to have returned to normal levels of earnings after suffering the effects of Hurricane Fabian last year.  With increased new business, careful claims management particularly in health insurance, the lack of major windstorms and a sound investment portfolio, Argus is in a strong position going into 2005. I would like to thank our employees who have worked hard to make this a successful earnings period for the company."

Total premium income net of reinsurance improved by 18% and income from commissions and management fees increased by 31%. These increases are primarily a result of new business and appropriate adjustments to premiums in both the Group Insurance and Property and Casualty divisions. This has resulted in the realisation of targeted underwriting ratios in all business areas except our motor account which continues to perform poorly. The uplift of premium income in the Property and Casualty divisions has resulted in increased ceding commissions received from our reinsurers.  The growth in assets under management in the pension business has also lead to higher management fees.  This department made a small contribution to earnings during the period.

Investment income declined by almost 4% due to the lackluster performance of international markets, but was buoyed by the continuing strength of our portfolio of local equity investments that continue to be a significant store of value.

Operating expenses and commissions increased by 21% in this period compared to the corresponding period in 2003 because of additions to staff and computer systems to support the growth in business.  Operating expenses and commissions are 19% of total income compared to 18% a year earlier.

Given normal claims experience and stable financial markets Argus expects profits for the year ending March 31, 2005 to exceed those of the prior year. 

-ends -

Notes to Editors

Argus Insurance Company Limited and its subsidiaries (The Argus Group) is the largest Bermuda-owned insurance company. Argus writes most classes of insurance through specialised property, life and health insurance companies and is the leader in pension and group health insurance plans in Bermuda.  Argus is the leader in pension and group health insurance plans in Bermuda.  The Argus Group is rated "A" Excellent by the insurance rating agency, A. M. Best.

Media Contact:

Gerald D.E. Simons                    David W. Pugh

President & Chief Executive Officer   Chief Financial Officer

Tel: (441) 298-0810                   Tel: (441) 298-0832

e-mail: gsimons@argus.bm              e-mail: dpugh@argus.bm