November was the month when rumours first began about FTSE 100-listed giant Capita taking over ailing insurance group Eastgate. Insurance Times printed the rumour on the front page of its first issue in November and the following week the announcement was made that Capita was snapping up Eastgate for just £9.1m.
Eastgate has apparently struggled with debts of £26m after a disputed purchase of Hambro Assistance from its former parent company Lindsey Morden Group (LMG) in November 1998. Following the takeover, Eastgate's name and brand will vanish completely.
Lloyd's also dominated the news in November, as the the new entry criteria for brokers and intermediaries were revealed for the first time.
As part of an on-going modernisation programme, these new rules will scrap the closed shop whereby access is officially restricted to the 200 Lloyd's brokerages. The first absolute requirement was that brokers needed to be members of the GISC or for overseas brokers a national equivalent.
Other news included PX Re quitting Lloyd's, blaming the market's “excessive” expenses for the withdrawal. The move immediately forced one of the group's syndicates into run-off and left two others seeking to create their own integrated Lloyd's vehicles.
The results of the Jaffray case were also heard, with Lloyd's winning its £20m legal defence brought by 216 former Names who alleged they had been hoodwinked into sustaining heavy losses in the insurance market.
In his judgment Mr Justice Cresswell said there had been no fraud or misrepresentation by Lloyd's. Moreover, he said that Lloyd's committee members had at all times acted honestly in the affair.
However, Cresswell reserved some harsh criticism for Lloyd's, accusing the market of a “staggering” catalogue of failings and incompetence.
Also in this month QBE put the retail division of Iron Trades and its motor website into run-off and gale force winds lashed Britain with early predictions about the cost to insurers being in the £500m region. In addition, Miles Smith vowed to pay off its debt to the London market within two years. The liability and motor brokerage was forced into creditor's voluntary liquidation in May after its parent company Greatminster Group failed to repay its inter-company debt to Miles Smith.