The source said Eagleburger, who was president George Bush's last secretary of state, was the unanimous choice of the 12-member international commission formed a month ago to resolve the issue. The commission is composed of European insurance companies, US states insurance commissioners and representatives of the state of Israel and the World Jewish Commission.

Eagleburger is considering the proposal and is expected to let the commission know his decision within a few days, the source said. At issue are the claims against insurance companies from Germany, France, Italy and Switzerland that issued policies in prewar Europe which Holocaust survivors claim were never paid after the war. The World Jewish Congress has estimated that life insurance policies held by Jews inprewar Europe alone would amount to $2.5 billion today.

Six European insurance companies agreed to forming the commission last month. They are Allianz AG of Germany, Axa of France, Generale of Italy and three from Switzerland: Zurich, Basler Leben and Wintherthur Leben. They signed a memorandum of understanding to create an international commission together with the US National Association of Insurance Commissioners and Jewish representatives. The 12-member commission, which met for first time on Wednesday, asked Eagleburger to become the 13th member and chairman.