Lloyd's chief defends offer

Click to follow
The Independent Online
DAVID ROWLAND, chairman of the Lloyd's insurance market, yesterday hit out at critics of the authorities' pounds 900m offer designed to rescue thousands of underwriting members from financial ruin.

'It would be an irresponsible matter for anyone to recommend that the offer is rejected,' he warned. 'Whoever did so would not be doing their job properly.'

Mr Rowland said that the offer would not be increased or repeated although he was prepared to furnish more information. There has been widespread anger in the market at the low level of the terms of the offer, which is designed to end legal action against companies that looked after members' affairs.

Christopher Stockwell, chairman of the Lloyd's Names Association's working party, co-ordinating the efforts of 17,000 members, said that Mr Rowland's comments sounded like the cry of a desperate man. 'Action group chairmen, representing the members and who form our committee, have a clear view. Collectively, they intend to recommend rejection of the offer.

Earlier this week Mr Stockwell had condemned the offer as 'an exercise with mirrors', arguing that most members would receive nothing except a nominal allowance towards next year's losses. These are widely expected to be about pounds 2bn, making total losses of pounds 7.5bn over a four-year trading period.

Mr Rowland confirmed that Lloyd's expects to have the backing of members who would receive 70 per cent of the settlement offer.

But members whose affairs were managed by the Gooda Walker, Feltrim and Merrett underwriting agencies, who receive at least pounds 480m in the settlement proposal, have given action groups discretion to accept or reject the offer.

Action group meetings will vote on the proposals; the decisions will be binding. Gooda Walker will hold its meeting on 17 January and Feltrim on 21 January.

Mr Rowland was formally nominated to continue as chairman of the market's ruling council.