Lloyd's names brace themselves for the reckoning

More than 34,000 Lloyd's names world-wide are bracing themselves this weekend for the first estimates of how much it will cost to end their eight-year nightmare with the troubled insurance market.

Lloyd's last night embarked on the biggest mailing exercise in its history, sending out worldwide the individual bills that names have been waiting for, fearing, for many months.

A roll-call of famous names, including Virginia Wade and Henry Cooper, the actress Susan Hampshire and Ian Lang, the President of the Board of Trade, will be among those looking to the doormat on Monday morning for the bulky package, full of advice and warnings, and the vital figure of what Lloyd's pledges is the final bill to end it all.

About 9,000 names face paying the maximum pounds 100,000, over and above losing all their funds deposited at Lloyd's. A further 4,000 will need to raise cash sums of up to pounds 100,000 as the cost of covering all potential liabilities from the old policies that Lloyd's is hiving off into a special re-insurance vehicle, Equitas. Lloyd's stressed yesterday that these are estimated bills; the final Equitas premium statements will be sent out in late May.

Lloyd's chairman, David Rowland, urged names in an accompanying letter to bite the bullet and accept this as the price for drawing a line under the traumas of the past. There will not be another settlement plan. "If we miss this opportunity, the consequences will be very serious. None of us should be under any illusion that any alternative proposals offer greater comfort," he said.

But several names' action group leaders, who had received their bills earlier, warned that the cost for the hardest-hit and most litigious names is still too high. "As a result of what we know now, it is clear the amount of money on the table is insufficient. We need another pounds 400m to make Equitas fly," said John Mays, chairman of the Merrett action group.

He is among a deputation of names' leaders urging the Department of Trade and Industry to bring pressure to bear on Lloyd's to find more than the pounds 2.8bn of credits and debt relief that the society is using to reduce the cost to names of settling.

Representatives of the names believe that without another pounds 350m-pounds 500m added into the pot to reduce, and perhaps halve the size of the maximum bill to pounds 50,000, there is a serious risk that the settlement will be voted down when it is put to the market as a whole in July. Names believe it would cost only about pounds 350m to halve the cap.

As well as shrinking the pounds 100,000 cap, which affects 9,000 heavily loss- making names, there are hopes that additional funds can be found to help out members of the hardest-hit syndicates and to increase the sums set aside for hardship relief. "Either Lloyd's needs to find more funds from market professionals, or with the DTI it must agree to reduce the very harsh reserving requirements for Equitas. Either would ease the cost to names," Mr Mays said.

Anthony Nelson, the DTI minister responsible for the insurance market, has been told by names groups that the funding of Equitas is far too conservative and is mopping up money that could be better used in improving the terms for names.

Lloyd's has been hinting privately that it expects to be able to increase the offer to names by the time the final bills go out, even if it means raising a loan in the market.

Comment, page 21

Weekend, page 22

The Lloyd's nightmare

1987 Profit pounds 509m

1988 Loss pounds 510m

1989 Loss pounds 1.9bn

1990 Loss pounds 2.3bn

1991 Loss pounds 2bn

1992 Loss pounds 1.2bn

1993 Est profit pounds 1bn

1994 Est profit pounds 1bn

1995 Est profit pounds 888m

Start your day with The Independent, sign up for daily news emails
Life and Style
love + sex A new study has revealed the average size - but does that leave men outside the 'normal' range being thought of as 'abnormal'?
Arts and Entertainment
The Palace of Westminster is falling down, according to John Bercow
voices..says Matthew Norman
Steve Bruce and Gus Poyet clash
Graham Norton said Irish broadcaster RTE’s decision to settle was ‘moronic’
Arts and Entertainment
Jake and Dinos Chapman were motivated by revenge to make 'Bring me the Head of Franco Toselli! '
arts + ents Shapero Modern Gallery to show explicit Chapman Brothers film
Arts and Entertainment
Kurt Cobain performing for 'MTV Unplugged' in New York, shortly before his death
music Brett Morgen's 'Cobain: Montage of Heck' debunks many of the myths surrounding the enigmatic singer
ebooksA special investigation by Andy McSmith
Life and Style
Brendan Rodgers
football The Liverpool manager will be the first option after Pep Guardiola
Amazon misled consumers about subscription fees, the ASA has ruled
Arts and Entertainment
Myanna Buring, Julian Rhind-Tutt and Russell Tovey in 'Banished'
TV Jimmy McGovern tackles 18th-century crime and punishment
Arts and Entertainment
Paul Whitehouse as Herbert
arts + ents
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Sales Executive - OTE £40,000

£15000 - £18000 per annum: Recruitment Genius: This is a great opportunity for...

Austen Lloyd: Law Costs HOD - Southampton

£50000 - £60000 per annum + Excellent Salary: Austen Lloyd: An outstanding new...

SThree: Recruitment Resourcer

£20000 - £21000 per annum + uncapped commission: SThree: As a graduate you are...

Ashdown Group: Junior Application Support Analyst - Fluent German Speaker

£25000 - £30000 per annum + benefits: Ashdown Group: A global leader operating...

Day In a Page

Syrian conflict is the world's first 'climate change war', say scientists, but it won't be the last one

Climate change key in Syrian conflict

And it will trigger more war in future
How I outwitted the Gestapo

How I outwitted the Gestapo

My life as a Jew in wartime Berlin
The nation's favourite animal revealed

The nation's favourite animal revealed

Women like cuddly creatures whilst men like creepy-crawlies
Is this the way to get young people to vote?

Getting young people to vote

From #VOTESELFISH to Bite the Ballot
Poldark star Heida Reed: 'I don't think a single bodice gets ripped'

Poldark star Heida Reed

'I don't think a single bodice gets ripped'
The difference between America and Israel? There isn’t one

The difference between America and Israel? There isn’t one

Netanyahu knows he can get away with anything in America, says Robert Fisk
Families clubbing together to build their own affordable accommodation

Do It Yourself approach to securing a new house

Community land trusts marking a new trend for taking the initiative away from developers
Head of WWF UK: We didn’t send Cameron to the Arctic to see green ideas freeze

David Nussbaum: We didn’t send Cameron to the Arctic to see green ideas freeze

The head of WWF UK remains sanguine despite the Government’s failure to live up to its pledges on the environment
Author Kazuo Ishiguro on being inspired by shoot-outs and samurai

Author Kazuo Ishiguro on being inspired by shoot-outs and samurai

Set in a mythologised 5th-century Britain, ‘The Buried Giant’ is a strange beast
With money, corruption and drugs, this monk fears Buddhism in Thailand is a ‘poisoned fruit’

Money, corruption and drugs

The monk who fears Buddhism in Thailand is a ‘poisoned fruit’
America's first slavery museum established at Django Unchained plantation - 150 years after slavery outlawed

150 years after it was outlawed...

... America's first slavery museum is established in Louisiana
Kelly Clarkson: How I snubbed Simon Cowell and become a Grammy-winning superstar

Kelly Clarkson: How I snubbed Simon Cowell and become a Grammy-winning superstar

The first 'American Idol' winner on how she manages to remain her own woman – Jane Austen fascination and all
Tony Oursler on exploring our uneasy relationship with technology with his new show

You won't believe your eyes

Tony Oursler's new show explores our uneasy relationship with technology. He's one of a growing number of artists with that preoccupation
Ian Herbert: Peter Moores must go. He should never have been brought back to fail again

Moores must go. He should never have been brought back to fail again

The England coach leaves players to find solutions - which makes you wonder where he adds value, says Ian Herbert
War with Isis: Fears that the looming battle for Mosul will unleash 'a million refugees'

The battle for Mosul will unleash 'a million refugees'

Aid agencies prepare for vast exodus following planned Iraqi offensive against the Isis-held city, reports Patrick Cockburn