Bermuda-based White Mountains Insurance Group, Ltd. announcedtoday that Ray Barrette has been elected to replace retiringChairman Jack Byrne.

In addition to taking over as chairman of the board, Mr.Barrette, who is currently a director, will take on the position ofchief executive officer, replacing Steve Fass, who is alsoretiring.

In a statement, Mr. Byrne said, “With great regret, I mustretire completely at this time.” He added, “I have no doubt thatRay Barrette is the right person to lead the company goingforward,” noting that both he and his wife had given a full proxyto vote their shares in favor of Mr. Barrette's appointment.

He also noted the “strong contributions” that Mr. Fass has madeto the company over many years. “I asked him to stay. I amdisappointed that he [Mr. Fass] has elected to retire from activemanagement, but pleased that he will remain as a director andadvisor,” Mr. Byrne said.

“The company is in terrific shape. We finished 2006 on a strongnote,” he said.

Mr. Barrette originally joined the company in 1973 and wasformerly CEO and a director of the company until his retirement inOctober 2005.

He left retirement and returned as a director in August 2006just days after the company announced reduced second-quarterearnings.

The earnings were marred mainly by a decision to reimburse morethan $130 million to investors in White Mountains' reinsurancesidecar, Olympus, when offshore energy losses from HurricaneKatrina emerged unexpectedly.

At the time, Mr. Byrne referred to the Olympus situation as a“sorry chapter” in the life of the company.

Both Mr. Byrne and Mr. Fass were investors in Olympus when itwas first set up in 2001. Original investors saw their investmentswiped out by a first wave of storm losses in 2005, but a new set ofinvestors came in to recapitalize the venture prior to theemergence of the energy losses.

Referring to today's announcement, Mr. Barrette said: “I amexcited about rejoining a strong management team and assumingleadership of the board. I appreciate the board's confidence andsupport. I will strive to always deserve both.” He thanked Mr.Byrne for 22 years of service.

“Some tactics may change,” Mr. Barrette added, “but we remainfocused on our mission of delivering superior returns to ourowners.”

In today's announcement, White Mountains disclosed details ofstock option grants that the company said will serve as a materialinducement to Mr. Barrette to accept his new positions, adding thatthese had been approved by the compensation committee and theboard.

According to the firm's Web site, Mr. Barrette is also currentlya director of Bermuda-based Montpelier Re Holdings, Ltd. Inaddition to prior positions at White Mountains and itssubsidiaries, Mr. Barrette has been a consultant withTillinghast-Towers Perrin and president of the personal insurancedivision at Fireman's Fund Insurance Company.