A war of words has broken out between wholesale broker John W. Beard and one of its sub-agents, Lloyd Manley, following revelations in Insurance Times that the latter had been charging excessive administration fees.
John Beard, managing director, says there appear to be many instances of overcharging by the Staffordshire intermediary, when selling his firm's Clubsure scheme to working men's clubs.
Beard has written to 50 clubs in the North West, advising them to check their policies, which has led to Lloyd Manley accusing the broker of attempting to poach its client base.
“He is deliberately trying to get our clients to renew with them,” said John Bateman, Lloyd Manley director.
He adds that his firm is willing to disclose the full details of its own internal investigation once it has been completed.
Last week Bateman admitted that there were seven instances where his firm had charged excessive fees of up to £700.
But Beard claims his own investigation will reveal a far higher number.
Meanwhile, Groupama is unwilling to disclose the details of its own audit of Lloyd Manley's books, conducted by two senior staff last week.
Commercial director Maggie Lister said it would be inappropriate to release the details without first consulting with Lloyd Manley at a meeting next week, even though the intermediary has itself admitted to cases of overcharging.
In addition, Lister could not confirm that the details of the audit would be ever released, despite a Groupama spokesperson making this assurance to Insurance Times last week.
However, Groupama said it has asked Lloyd Manley to implement new and stricter procedures in a bid to prevent further instances of overcharging in the future.
The insurer issued the following statement about its investigation: “As a direct result of these enquiries, we have become aware of some serious administrative deficiencies, and we will now be widening our enquiries to include some further cases and a number of our policyholders.
“In light of our initial findings we have already arranged an urgent meeting with Lloyd Manley to discuss the results of our investigation and to determine their response to our concerns and the remedial measures that we consider necessary at this time.”
A spokesperson for Groupama added that an Association of British Insurer's code of conduct monitoring team will be visiting Lloyd Manley next week, and that the insurer would be co-operating with their audit.