Chartwell Underwriting is believed to be up for sale for about £20m, with Independent Insurance being touted as favourite to snap it up, writes Alaric Nightingale.

Independent denied outright that it was seeking to purchase the company but Chartwell's chairman Jeremy Adams admitted the company has been the subject of several approaches.

He said: "We get approaches for our operation on a constant basis. We are in a period of change."

But one inside source told Insurance Times that Chartwell has been in talks with Independent.

Currently Chartwell's American capital provider, Trendwick, is finalising a merger with La Salle. This has lead to speculation that Chartwell will be sold off as part of the deal.

Chartwell operates from six offices the UK. It employs around 150 staff, but it has struggled for several years in the soft liability market.

In a bid to bring greater efficiency, for the past five years Chartwell has pared down the number of brokers it uses from 5,000 to 1500. The company also switched to a new lead underwriter in January, The Underwriter, in a further attempt to bring profitability.

Independent spokesman Graeme Sutton denied the deal was about to take place.

He said: "There is no foundation to it. Chartwell is only a market rumour."