In terms of the numbers of parties involved, the legal action is believed to be the largest mounted in the 305-year history of the insurance market.
Through the authorities of Lloyd's, the defendants named in the action said that they would be contesting the action. Lloyd's itself described the legal campaign as 'regrettable'.
The action has been triggered by the huge losses that have arisen on a range of insurance syndicates once managed by the Gooda Walker agency.
The claim of the underwriting members asserts that their losses of pounds 396m on four insurance syndicates - 164,290, 298 and 299 - under the management of Gooda Walker resulted from negligence in underwriting.
An action group raising funds from the underwriting members to mount the legal action has collected more than pounds 4m.
'To avoid any delay in the litigation, the main action is focused on the the issue of negligent underwriting, but litigation on other issues and against other parties is being considered and further proceedings may be issued shortly,' said Michael Deeny, an accountant and concert promoter who is chairman of the group.
'The average loss to our members is pounds 184,877,' Mr Deeny said. 'But some individual members have lost up to pounds 1m.
'Some of these were underwriting at Lloyd's on the basis of a bank guarantee secured on their family home and had no other substantial assets.
'The most tragic cases are the many old age pensioners who thought that their membership of Lloyd's would bring in a little extra income in their retirement. All of these now face total ruin,' he added.
Mr Deeny stressed that in the absence of any concrete financial help from Lloyd's, the members' only hope lay in litigation.
'Fortunately, we have a strong case and the funds to fight it. We go forward confident of the justice of our cause, the merits of our case and the prospects of victory,' he said.
Lloyd's last year published its own findings on the circumstances that led to the losses on the Gooda Walker syndicates. Its report was critical of the agency's management.Reuse content