Gross corporate negligence cover missing from Jarvis's insurance

Jarvis, the maintenance contractor responsible for the upkeep of the tracks and points where the Potters Bar rail crash occurred does not have gross corporate negligence cover.

A Jarvis spokesman told Insurance Times the company held a qualifying contract with Railtrack which covers liabilities upto £155m. "We have told the City that we have cover and the £155m should be enough. However, we do not have gross corporate negligence cover. It is a difficult market at the moment.

"But as there is no conclusive evidence at the moment, we have no liabilities," he said.

According to sources, Steve Solley of First City is broker for Jarvis Maintenance. Aon said Railtrack was a client but would not disclose any details of its involvement.

Corporate services director for Cunningham Lindsey, David Martin, said the loss adjuster had been appointed by Railtrack. He said the precise loss figure will depend on an assessment of the platform and and canopy damage.

"But I don't think we are looking at losses as high as Ladbroke Grove," he said.

The estimated loss for that crash is £70m.

"Services should be restored by Monday. But there still needs to be an assessment of the road bridge," he said.

US insurer AIG is involved with Railtrack's complex insurance programme, he confirmed. A St Paul Insurance spokesman said it insured the train operating company WAGN for property and public liability.

Jarvis and Railtrack could face corporate manslaughter charges as a result of those injured or who lost friends and relatives, said lawyers. Seven people died and up to 90 were injured in the crash last Friday.

But, according to Reynolds Porter Chamberlain's D&O partner Ed Smerdon, both company's directors may avoid prosecution. "It would be difficult to prove sufficient culpability in such a case and find who was liable," he said.