Tension is mounting between Lloyd’s insurers and members’ agents over QBE’s failed attempt to buy-out the remaining Names in its specialist liability Syndicate 386.

QBE was forced to withdraw an offer when investors rejected what was regarded as “the highest ever, offered within a Lloyd’s capacity”.

Under Lloyd’s rules, the insurer was not allowed to communicate directly with Names and members’ agents were not required to formally consult Names before reaching a view on value.

This has led a number of senior insurance figures to question the tactics of the remaining members’ agents, Argenta and Hampden.

QBE Group chief executive Frank O’Halloran said: “There is no other market where the established custom allows intermediaries to exercise such influence without reference to their principals.”

A senior Lloyd’s figure added: “A huge price was offered to QBE external names. All are amazed that QBE failed.”

Hampden Agencies insisted that it was open to a managing agent’s aligned corporate to make an offer direct to members without a recommendation from the members’ agents – subject to the Lloyd’s timetable.

“Hampden has been keeping its clients informed and advised and will continue to do so,“ it added.

The Association of Lloyd’s Members (ALM), which also represents the interests of Lloyd’s Names, defended members’ agents.

Anthony Young, ALM chief executive, said: “We have been slightly critical of members’ agents for not defending Names in the way we had hoped, but we are happy that they are standing up, being counted and defending the interests of Names in this way.

“The impression I get from our members is that they would prefer to stay on Syndicate 386 rather than accept the offer of £1.25.”

As part of Lloyd’s strategic plan, senior members examined the annual venture – a feature of Lloyd’s in which a group of underwriting members support a syndicate’s underwriting for a specific year of account – in October 2006.

Recommendations were made in bid to make arrangements between insurers and private capital investors more flexible.

O’Halloran said Lloyd’s annual venture and agency arrangements was in need of “urgent reform”.

But a Lloyd’s spokesman said: “The fact that these negotiations have failed is due to the failure to agree commercial terms.”