EXHIBIT 8.1
 
                  FORM OF MORGAN, LEWIS & BOCKIUS TAX OPINION
 
               , 1996
 
PXRE Corporation
399 Thornall Street, 14th Floor
Edison, NJ 08837
 
Ladies and Gentlemen:
 
     We  have acted as special  U.S. tax counsel to  PXRE Corporation a Delaware
corporation  (the  'Company'),   in  connection  with   the  preparation  of   a
Registration  Statement on  Form S-4  (Registration No.      -          ), dated
           , 1996  (the 'Registration  Statement'), containing  the Joint  Proxy
Statement  of  the  Company   and  Transnational  Re  Corporation,  a   Delaware
corporation  ('Transnational')  and  Prospectus   of  the  Company  (the  'Proxy
Statement/Prospectus')  relating to the merger  of  Transnational with  and into
the  Company (the 'Merger').
 
     Unless  otherwise defined  herein, capitalized  terms used  herein have the
respective meanings ascribed to those terms in the Registration Statement.
 
     In arriving at  the opinion expressed  below, we have  examined and  relied
upon the following documents:
 
          (a) the Registration Statement;
 
          (b)  the tax representations letters of  even date herewith to us from
     the Company and Transnational;
 
          (c) the Agreement and Plan of Merger, dated as of August 22, 1996,  as
     amended between the Company and Transnational; and
 
          (d)  such other documents,  records and instruments  as we have deemed
     necessary or appropriate as a basis for our opinion.
 
     We have  also  read and  relied  upon  originals or  copies,  certified  or
otherwise  identified to  our satisfaction, of  such records of  the Company and
Transnational  and  such  certificates  and  representations  of  officers   and
representatives  of  the  Company  and  Transnational,  and  we  have  made such
investigations of law, as we have deemed appropriate as a basis for the  opinion
expressed  below.  In  our  examination, we  have  assumed  the  authenticity of
original documents, the accuracy of copies and the genuineness of signatures. We
understand and assume that (i) each agreement referred to in clause (c) above or
otherwise referred to  in the  Registration Statement represents  the valid  and
binding  obligation of the respective parties thereto, enforceable in accordance
with its respective  terms, and the  entire agreement between  the parties  with
respect  to the subject matter thereof, (ii)  the parties to each such agreement
have complied,  and  will  comply,  with  all  of  their  respective  covenants,
agreements  and undertakings contained therein,  (iii) the transactions provided
for by  each  such  agreement  or otherwise  referred  to  in  the  Registration
Statement  were and will be carried out  in accordance with their terms and (iv)
the Merger will be effective under the law of the State of Delaware.
 
     Our opinion is based  upon existing United States  federal income tax  laws
arising   under  the  Internal  Revenue  Code  of  1986,  as  amended,  Treasury
regulations promulgated thereunder,  administrative pronouncements and  judicial
decisions  as of the  date hereof. All  such authorities are  subject to change,
either prospectively or retroactively.  No assurance can be  provided as to  the
effect of any such change upon our opinion.
 
     The  opinion set forth  herein has no  binding effect on  the United States
Internal Revenue Service or the courts of the United States. No assurance can be
given that, if the matter were contested,  a court would agree with the  opinion
set forth herein.
 
     Based  upon the foregoing  and such consideration  of matters of  law as we
deemed to be  relevant, and subject  to the qualifications  and assumptions  set
forth  herein,  we are  of the  opinion that  the  Merger will  be treated  as a
tax-free reorganization  under  Section 368(a)  of  the Code  and,  accordingly,
neither  the Company nor the Company's  stockholders will recognize gain or loss
for United States federal
 


income tax purposes as a result of the consummation of the Merger, except to the
extent that  the  Company's stockholders  receive  cash in  lieu  of  fractional
shares.
 
     In  giving the foregoing opinion, we express no opinion regarding any other
aspect of federal tax law or any aspect of state, local or foreign tax law.
 
     We are furnishing this letter in  our capacity as special U.S. tax  counsel
of  the Company and this  letter is solely for the  benefit of the Company. This
letter is not to be  used, circulated, quoted or  otherwise referred to for  any
other purpose.
 
                                          Very truly yours,