Esure, the motor insurer launched by Direct Line founder Peter Wood, is buying into troubled Lloyd's operation Cox.

Wood's company is taking advantage of a £65m capital raising exercise to invest £1.65m for a 1.3% stake.

Cox last week reported a pre-tax loss of £240.6m, down from a loss of £6.4m the year before.

The result is equivalent to a loss of 162.5p a share, which looks bad even against other Lloyd's operators' recent losses.

SVB lost 46.4p a share, Brit lost 33.34p a share, Hiscox lost 15.5p a share and Goshawk lost 7.1p a share.

With a £125m loss due to the 11 September attacks and a £95m loss run up by its commercial division, a record profit of £36.7m in the retail division was overshadowed.

Closing down its commercial side will generate run-off costs of £9m.

But the company plans to reinvent itself as a motor insurer on the back of its successful Equity Red Star operation.