An estimated pounds 25m of the deterioration was a consequence of the Lockerbie air disaster in December 1988. David Young, chairman of GW Run-Off, which is managing the winding-up of the syndicates, said that claims advice posted by a US insurance company, AIG, required a substantial reserve on Lockerbie. Two earlier catastrophes required reserves to be upgraded, and the reinsurance of Lloyd's Agents errors and omissions (E&O) claims continued to be a moving target, he said.
The 1991 losses were broadly in line with estimates made a year ago, while the deterioration on old years was higher as Lockerbie and E&O losses could not be accounted for accurately because of insufficient information.
In January this year GW Run-Off advised Gooda Walker names that losses of pounds 1.1bn should be the maximum. Mr Young said he was still of that view.
Michael Deeny, chairman of the Gooda Walker Action Group, said: '(The figures) justify our decision not to accept the Lloyd's settlement offer when we did not know the final magnitude of the losses. They will also lead to an increase in the amounts we are claiming in our legal proceedings, which will now total over pounds 600m.'Reuse content