Axa, the French insurance group, is to make a radical change in strategy to reduce dependence of its profits on equity markets following the September 11th attacks in the US.

The company, hard hit by losses from the attacks, will seek to maintain profitability by cutting annual costs by $640-$915 million (€703-€1,005 million) next year. Axa owns Guardian/PMPA, the State's largest motor insurer.

Axa will cut staff, sharply reduce use of outside consultants and invest only in vital new projects. Axa Financial, the group's US arm, will contribute $250 million of the cost cuts.

"We must review everything," Gerard de la Martiniere, Axa's chief financial officer, said yesterday.