Insurers are in the news again for rejecting some high profile claims. But John Jackson says it's the brokers who suffer

There is a new variation on the theme of What the Butler Saw. It is What the Butler revealed - or did not reveal - to his insurer.

Former royal butler Paul Burrell, according to The Mirror, has had a claim rejected by his insurer, New India Assurance, following a malicious fire at his Wrexham flowershop.

He is disputing rejection of the claim, and says all material information, including the fact that he was Paul Burrell the royal butler and had received nuisance phone calls, had been revealed to his insurers.

For someone who was unable to obtain insurance while the Old Bailey court case was hanging over his head, now that he has been cleared of all charges, he must feel really peeved at his latest encounter with the insurance industry.

In another recent case, a woman who had a £315,000 medical bill for an operation on a tumour while on holiday in the US, has had her claim rejected by her insurer, Lloyds TSB, according to the front page of The Sun.

One curious point of this case is that, apparently, although the claim was rejected a Lloyds TSB spokesman has subsequently said the insurer is awaiting information from the US hospital and the woman's doctor.

If it had not fully concluded its investigation, how could it have already rejected the claim?

These high profile cases rebound badly on the industry, whatever the rights and wrongs of individual claims.

In general, insurers tend to give good reasons for rejecting a claim. But frivolous reasons for rejecting claims are not unknown - particularly where the small print is not read by the policyholder.

The point is this: is the insurer "wriggling" to get off the hook of paying or not? One problem is that often claims handlers are inexperienced and adopt the attitude of "if in doubt - repudiate".

Often, they do not pass the claim up to a more experienced manager for advice. Also, brokers can inadvertently get behind with their paperwork and not update underwriters.

And it is the broker who gets it directly in the neck from the rejected policyholder. After all, it is his client. However hard the broker fights for his client, the policyholder may well move his business.

In such cases, Joe Public sees the `deadly trio' of insurer, broker and loss adjuster as a gigantic rip-off conspiracy. "They've got my premium - now they're stuffing me" is the cry.

However, what is frivolous to the policyholder may be watertight in law. It is caveat emptor writ large.