Lloyd's members offered cover beyond the grave

Click to follow
UNDERWRITING members of the Lloyd's insurance market are being offered new facilities to protect their families against insurance losses after they have died.

Under Lloyd's rules the estates of members of Lloyd's are still liable to meet claims once any member has died.

In Lloyd's, 1,452 members have taken out insurance to protect their estates against the consequences of their share of pounds 2.5bn of losses that have fallen on the market in the past two years.

However, insurers at Lloyd's have paid out pounds 43m in claims on this type of business during the summer against the pounds 10m of annual premium that this class of risk earns.

According to Holman Wade, the insurance broker, which specialises in 'estate protection plans', insurers have decided not to make their final decision on whether to accept this business until the latest possible date.

Because of the hesitancy of insurers, Holman Wade is placing the business with Lloyd's own company, CentreWrite, set up in July of last year. CentreWrite is funded by contributions from all Lloyd's members.

Michael Wade, of Holman Wade, stressed yesterday that the business would eventually be passed to conventional underwriters from CentreWrite with no extra commissions or charges being paid to Holman Wade.

'We have tried to satisfy the needs of all members and respond to the many constructive suggestions received from the agents who look after their affairs,' Mr Wade said.

Initial premiums on this insurance will range from pounds 350, if a member is under 46, to pounds 950 if over 60.

CentreWrite was set up specifically to help underwriting members close their accounts at Lloyd's with insurance against future losses. But with capital of pounds 50m it has been felt to be too small to provide the intended service. Lloyd's is studying ways of making it more effective.

Commentary, page 29