Crane hire company Baldwins Industrial Services has written off about £1m after attempting to replace its Independent Insurance cover.

It was the first contractor to announce a loss following the insurer's collapse, quickly followed by Speedy Hire and Amec.

Baldwins' finance director Andy Somerville said the company was discussing alternative cover with a number of other insurers, but was yet to make a decision on which to take.

However, he said the insurance industry was using Independent's collapse to “make a lot of money”.

“We're expecting to pay more for cover and have a higher excess,” Somerville said.

“It depends on our claims this year, which we've factored into the £1m as best we can.”

Baldwins, which made £5.8m profit last year, experienced a 10p drop in its share price after announcing the loss.

“It's one element that makes up our trading performance and it's painful, but we'll just have to try to pass the cost onto our customers,” Somerville said.

“One of the problems is that it happened early in our insurance year – we'd only got two-twelfths of our cover.”