Norwich Union (NU) has stopped taking new stand-alone liability business and upped the minimum premium for renewals of existing business to £1,000.

In a letter leaked to Insurance Times, NU told brokers that the liability account continued to produce unacceptable returns, despite the company's efforts to make it more profitable.

In the first six months of this year, the combined operating ratio for the company's £117m worth of liability premiums was 128% – it paid out £128 for every £100 of income – leading to a net loss of £33m for the period.

NU's director of underwriting, John Seaton, said the new minimum premium would affect 15% of its current book.

Chief executive of the British Insurance Brokers' Association (Biba), Mike Williams, said the decision was disappointing. “Norwich Union didn't consult with us and we are not aware that it consulted with our members.”

He added that options were becoming more and more limited for brokers as the market consolidated. “It doesn't make it any easier to find new homes for liability business.”

Managing director of Ajax Insurance Brokers in Liverpool, David Bunting, said: “The trend is that insurers have been reluctant to quote on stand-alone business.”