Lloyd's refuses inquiry into pounds 54m deficit

Click to follow
The Independent Online
THE authorities of the Lloyd's of London insurance market are refusing to mount a loss review into the circumstances of the pounds 54m deficit that has built up on syndicate 475, although the syndicate's former underwriter, Roy Bromley, committed suicide last week.

In a decision that has caused anger among professional agents who look after underwriting members' affairs and the 1,400 underwriting members who support the operation of the syndicates, Lloyd's said yesterday: 'There is nothing we can do at this stage.'

Lloyd's has a rule ensuring that internal inquiries are carried out automatically if the actual losses exceed the amount of financial support backing an insurance syndicate. While managers of syndicate 475 expect losses to exceed 200 per cent of the financial resources, Lloyd's will not act until the results are published.

Colin Spencer, an underwriting agent co-ordinating the activities of all 50 agents who introduced members to syndicate 475, said yesterday: 'We have written requesting a loss review . . . We are keen that Lloyd's gets to the bottom of the matter.'

John Gillespie, the managing director of Spratt & White, managing the affairs of syndicate 475, said that his agency had requested a loss review. 'We will be approaching Lloyd's about this in the near future. The underwriting members are very shocked about the death of Roy Bromley as they knew him personally.'

In December underwriting members were warned by Spratt & White that the losses had climbed from pounds 14m to pounds 54m. Spratt & White disputed claims by Mr Bromley that the syndicate would be profitable.

Spratt & White, which has managed the affairs of syndicate 475 since the end of 1991, blamed the deteriorating position on larger- than-expected losses from Hurricane Hugo in 1989 and the European storm damage in 1990.

Last week Mr Bromley shot himself at his London home in Dorset Square. He had not worked for the syndicate since he was dismissed by his board of directors in May 1991 for failing to follow the board's instructions.

While police have been carrying out routine inquiries into the background to his death the Metropolitan and City Police company fraud department said that it was not carrying out any investigation into Mr Bromley's affairs.