Brokers are holding more than £50m of premiums collected from Independent Insurance policyholders, according to a survey carried out by the British Insurance Brokers' Association (Biba).
And they want to hang on to the money, despite claims made on it by the liquidator.
Biba chief executive Mike Williams confirmed the figure ran into tens of millions of pounds and that details of the survey have been passed on to Independent liquidator PricewaterhouseCoopers (PwC). He said the survey covers hundreds of brokers.
PwC has urged brokers to return gross premiums generated by Independent policies. But brokers are resisting the pressure. Biba said brokers should hang on to their fees or commissions and return only net premiums.
However, Williams said that case law stated that commissions and fees are earned on day one of the policy. "Money is paid for placing the risk," he said. "So there is no reason to return fees and commissions."
It is understood that PwC has softened its attitude slightly, but is still expecting Independent's agency brokers to return commissions and fees on the basis that the brokers were much more closely tied to Independent.
Williams wants PwC to offer a settlement to brokers. "Otherwise, litigation could be its only course of action."
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