Brokers could be hit with a massive bill for using internet-based price comparison software covered by an obscure patent.
Inventor Roderick Lawrie claims to have a 20-year monopoly on software that searches for best product prices on the internet.
Lawrie, the owner of InCom Licensing, was granted the patent in 1997. He has been building funds to mount a legal defence. This is now complete.
Lawrie is demanding that anyone using his system should pay up or be shut down.
Other business targets could include online travel, accommodation and car sales.
Brokers will be charged between £50 and £100 per terminal per year, netting Lawrie, the former owner of Tayside Insurance broker in Scotland, £50m in his first year. In the second year the figure could rise to £125m.
Brokers with quote engines directly accessible to customers via the web will have to pay Lawrie a 0.1% transaction fee based on the annual turnover of business generated through the web system.
Lawrie's main targets will be the top brokers and internet brokers. These include the AA, which generates 45% of its quotes online, the RAC, Lloyds TSB Insurance and Its4me.co.uk. He said: "It's the big boys I'm after, any of them who trade electronically. Anyone who rocks the boat will not get a licence. I have the funds to make an example of any company that does not pay."
Its4me.co.uk managing director Paul Cheall said: "I can't believe that he can take any idea that has been in the public domain and patent it.
"I will definitely contest this."
An AA Insurance Services spokesman said: "Our call centres do not offer quotes online. I don't believe he can have a patent for this.
"All quotes are run on our own quote engine using our own software for which we have intellectual copyright.
"Once we have received the payment demand and patent we will discuss the matter with our lawyers."
RAC managing director Jason Richards said: "We will wait for the demand and assess the situation with our lawyers."
Web-based software houses such as Polaris, InsurE.com and SSP, will also not come away unscathed.
InsurE.com refused to comment until it had seen further details.
Polaris managing director Martin McLachlan said he was not concerned.
But Weightman Vizard patent lawyer James Powell said: "Brokers of all sizes should take this seriously. It will ultimately be up to the courts to dictate the implications, as there will be several major legal hurdles for the claim to clear."