Grant Thornton has set up a project it says will streamline processing in the reinsurance business and potentially save the industry more than £500m a year.

Project Corkscrew has been launched to tackle “spiral relationships”, where reinsurers can end up insuring the same risk several times over for ever-increasing amounts. The project works by simplifying the spiral, significantly reducing the number of spiral transactions and so reducing costs.

Around 3,000 reinsurers worldwide became involved in spiral business in London, mainly during the 1980s.

A typical spiral case is the claim resulting from the Piper Alpha oil rig explosion and fire in 1988. The original claim of £1bn has so far resulted in transactions in the reinsurance market of more than £10.6bn.

Reinsurers caught in a spiral cannot determine levels of exposure accurately and the best use cannot be made of capital and other resources.

Grant Thornton said the framework of the proposal would test the desire and commitment of the industry to participate in a co-operative solution.

The project is open for funding until the end of June, with Grant Thornton looking for £1.75m from the industry to proceed. Participants have to subscribe a minimum of £50,000 each.