Lloyd's head of regulation David Gittings will be questioned by US regulators about whether the insurance market can survive losses from the New York attack.

The examination, which is expected next month, will be held by UK accountants, who will be appointed by the US National Association of Insurance Commissioners (NAIC).

In September, after the attacks, Lloyd's chairman Sax Riley flew to the US to meet with Greg Serio, superintendent of insurance in New York.

One of the issues they discussed was the lowering of funding requirements for US underwriting.

Last week, the amount to be deposited in trust funds was cut from 100% of gross liabilities to 60% for the next quarter. Syndicates may also submit letters of credit as proof of available finances should a loss occur.

Lloyd's told the NAIC the events on September 11 would result in an estimated net loss of £1.3bn. The level of reinsurance protection in place and how much it thought could be recovered was also outlined.

Now the NAIC, chaired by John Oxendine, is appointing a firm of accountants to check the accuracy of these representations with the Financial Services Authority (FSA). Gittings and his regulation team will also be questioned.

A senior industry source said: "The ripple effect of facing a loss of this magnitude would be felt not just in Lloyd's, but also through the world equity markets.

"If representations are made to the NAIC, it will want to verify them. Accountants will talk to Gittings and his teams to see what is the regulatory impact and the quality of the reinsurance protection. In the worst case, it will put Lloyd's back to its existing funding of 100%."