Lloyd’s has ended its long-running central fund dispute, agreeing settlements with Aon and Benfield Group, the brokers that placed the reinsurance contract.
Although the terms remain confidential, Benfield Group announced an £8m net charge reflecting its costs towards the settlement.
Lloyd’s said this formed part of a larger package agreed between the two firms.
Aon has not disclosed any financial impact.
Legal sources have also inferred that financial statements could hide a bigger settlement that might include soft terms.
All parties have stressed that relationships stayed strong despite the dispute.
In 2000, Lloyd’s took out a £500m insurance policy to protect the new central fund. When calls were made on the reserve in the wake of the September 11 terrorist attacks, Swiss Re and five other reinsurers disputed some of the claims made under the contract.
In April, 2003 Lloyd’s began arbitration proceedings to recover the money.
Eventually a settlement agreement was reached with the reinsurers for £152m but this still left Lloyd’s with a shortfall.
In February 2006, Lloyd’s started legal action against Benfield and Aon in relation to their involvement in the placement of the policy.
Lloyd’s said it was seeking a total of £325m in compensation.
