Brokers dealing with country clients need to be especially wary of the Millennium Bug, insurance giant Axa is warning.

Last week a conference in Essex heard that if problems arose with the electricity supply, then smaller towns would suffer at the expense of larger urban areas where hospitals and other emergency services are located.

"If they have to shed power, then it will be the smaller towns that will be hit," said Axa business continuity planner Shirley Alexander warning brokers against complacency.

She said that so far Axa has spent a total of £40 million protecting itself and its customers against Y2K related problems. A further £6m spend was planned.

The company's main concern to date has been ensuring that customers' "business critical" computer systems will work properly in the New Year and that Axa's own offices will remain operational.

Speaking at an AiiB seminar, Alexander also warned brokers, especially those with clients in rural areas, against complacency.

Looking at her own organisation, she said that if there was a power failure then Axa had electricity generators on standby at all its "business critical sites" capable of supplying power for up to 14 days.

Bottled water had been ordered in for Axa staff in case of problems with the mains supply.

AXA has also replaced 3,500 personal computers across its operations and has held two trial runs over the Easter and August Bank Holiday weekends to test for problems. Alexander said that no significant difficulties had been encountered.