Hardy Underwriting Group's profits doubled to £6.7m last year from £3.2m in 2001.

The Lloyd's operator hit a combined ratio of 81.8% and raised its dividend to 7.25p from 6.5p.

The company pulled back from writing all the business it had wanted because prices for airline cover, in particular, fell too low.

Chief executive Barbara Merry said competition from Bermuda was pushing down volumes of business, particularly for non-marine catastrophe excess of loss.

She said: "Rates have been fairly well maintained, but the volume of business coming into London has reduced quite a lot."

And the outlook for the aviation book was "outstanding ", Merry said.

Hardy wrote gross premiums of £46.8min2002comparedto£32.2min2001.