Independent Insurance's executive chairman Garth Ramsay and finance director Dennis Lomas started checking the state of the failed insurer's cover immediately after chief executive Michael Bright resigned.
Insurance Times has uncovered correspondence dated May 11 from Ireco's Volker Handrich and Caryl Traynor to Aon Risk Consultants' Terry Masters, in which Ireco provided Masters with “the most recent/final versions” of Independent's reinsurance. The documents included property quota share 2001-2004, commutations for the London Market and provincial general liabilities protection and stop loss protection of international multi-line pool D 2001-2004.
Aon Risk Consultants has said Masters was requesting the documentation on behalf of Ramsay and Lomas, who contacted him after Bright's resignation on April 19.
It has already been alleged that the company's directors discovered previously unknown reinsurance deals following Bright's resignation.
Aon Risk Consultants has denied it provided brokerage services or received any commission or “overrider” from Independent's “core programme of reinsurance”. Instead, it “provided certain actuarial and technical support to Independent”.
Insurance Times reported last week that Independent bought cover from Ireco for its property account the day before auditors KPMG signed off its 2000 accounts. Days later, Independent's wholly-owned subsidiary Novi Re reinsured part of Ireco's book, which brought at least £15m of Independent's risk back onto Independent's accounts.
However, Aon Risk Consultants said: “As far as Mr Masters was aware, the Novi Re cover note was a normal reinsurance arrangement and did not have the effect of bringing Independent's own risk back onto its books.”
Independent's 1998, 1999 and 2000 accounts list Novi Re as 100% owned by the parent company.
It is unclear whether the cover notes sent to Masters by Ireco refer to any of the undisclosed number of contracts that partly caused actuaries Watson Wyatt to withdraw its support of the company.
Meanwhile, Insurance Times has uncovered correspondence from June 5 between Ramsay and Watson Wyatt's Mark Trayhorn, in which Ramsay said: “Since assuming my present position, there has been a concerted effort to address many items in relations to the company's business.”
It said: “One of these has been the level of case reserves. I believe you were aware of this and, in some ways, you prompted us to undertake the exercise due to the relationship between case estimates and total incurred estimates in your report that, at about 23%, appeared abnormal.”
