Referring to the story “Cash crisis for Indie creditors” (Insurance Times, August 9), I see a simple and easy solution.

It is reported that the Independent collapse is likely to cost Norwich Union (NU) around £100m to prop up the Policyholders' Protection Board. So how about NU providing the £1m needed to kick off the class action? This would be great PR for NU.

Perhaps Royal & Sunalliance (R&SA), which appears to be in the same boat, could chip in too.

Just think of the long-term benefits this could bring, if Michael Bright, KPMG, Watson Wyatt and the Financial Services Authority are found guilty of negligence and forced to cough up. NU would become the new light in the industry.

Of course, there is also a downside to consider, like who is the professional indemnity carrier for KPMG – not NU or R&SA, I hope.

So come on guys, get together and kick some ass.
RA Mikula
Topaz Insurance

Tragic irony
How ironic that Patrick Snowball should descibe the Independent collapse as “a PR disaster for the industry. It looks as though we don't know what we are doing.”

I would wager that the majority of brokers would agree with him completely if he substituted “the Independent collapse” with “the Norwich Union/CGU merger”.

Amusing, if it were not so tragic.
Paul Penrose
Managing director
Abbey Associates

Protecting clients
I would like to strongly refute in the strongest possible terms that Carole Nash Insurance Consultants was “rumoured to be close to collapse after Independent's failure”, as reported in your story entitled “Equity Red Star takes over Indie's bike book”. Nothing could be further from the truth.

Following Independent's failure, we announced that, despite the Policyholders' Protection Board offering only 90% payouts on comprehensive claims, our policyholders would receive full settlement of any claims made, as we would make up the shortfall.

We also immediately opened negotiations with our underwriters, resulting in Equity Red Star taking over the Independent motorcycle book. This move meant our policyholders faced no financial losses, as we are now providing equivalent cover up to renewal for no charge.

These actions contrast strongly with those who left customers high and dry with worthless cover notes and instructions to secure fresh insurance at their own expense. Ours are not the actions of a firm close to collapse, but of an ethically sound company with the strong financial base required to protect and preserve its client base and ensure future prosperity.

Your readers might also be interested to know that Carole Nash is enjoying not just rapid growth, but highly profitable growth. Our last accounts (to October 31, 2000) revealed profits doubled to £700,000, turnover was up from £5.8m to £8.5m and premium income increased from £20m to £31m (a figure which, incidentally, should have seen us in Insurance Times' recent Top 50 Brokers list).

Because we have handled the Independent scenario professionally and with due consideration to our policyholders, we are forecasting a further and significant improvement on those figures this year.
Malcolm Nash
Technical development director
Carole Nash Insurance Consultants

Lloyd's still on top
My recent letter to Insurance Times (July 12), about under-performing underwriters at Lloyd's was the first I have written in a long while. If all it has achieved is a response such as that of Charles Ross (Insurance Times, August 2), then it will be my last.

Nothing I said could justify the ill-informed opinions expressed by Mr Ross and I would like to disassociate myself from everything he has said.

He derides the Lloyd's claim to have “the greatest concentration of underwriting talent in the world” as rubbish. Add the usual descriptor “under one roof” and I would say the claim is probably still true, despite the need for the market's regulators to examine the poor performance of 51 underwriters.

Lloyd's is far from being alone in experiencing bad underwriting in recent years and there is plenty of blood on other people's carpets.

The question is, where do we go from here?

I believe the entire insurance market needs to invest more money on training and development if it is to win the war for talent.

It is not, I suggest, merely a matter of salaries. Nor do I agree that the starting salaries are “notoriously poor”. Lloyd's still offers bright people the chance to earn exceptional salaries while at the same time being able to share in the fortunes of the business. There is no ceiling at Lloyd's preventing bright people from rising to the top and serving on the council. There they will join the nominated members, who are far from ignorant about Lloyd's and insurance, as Mr Ross suggests.

Mr Ross contradicts himself when he says qualifications are neither respected nor rewarded by companies within Lloyd's, while pointing out that the regulators require active and class underwriters to be qualified to at least Associateship of the Chartered Insurance Institute (ACII) standard. The fact David Gittings does not possess the ACII is irrelevant, as he is a regulator and not a practitioner.

He suggests Gittings should review members and managing agencies – this is precisely what is done on a regular basis. Bad agencies are penalised as well as bad underwriters.

All of the other stuff about cronyism, politicking and institutionalised and democratic deficit Mr Ross mentions is simply not worth giving credence to. I spent a quarter of a century in the market and did not find any of it – maybe I became part of the structure Mr Ross believes is the cause of under-performance.

There are many highly qualified graduates working at Lloyd's and many qualified people from different disciplines, and the standards are rising noticeably. The days when all the top jobs were headed by Fellowship of the Chartered Insurance Institute (FCIIs) or ACIIs are long gone. Our two largest composites in this country are headed by a lawyer and an accountant.

Mr Ross says merchant bankers and lawyers “look at us with deserved and ill-conceived scorn and make their money out of our incompetence and inefficiency”. Well, Mr Ross, that's not how it seems to me, but if the cap fits…
Reg Brown

Jobs still going
Contrary to impressions given in Insurance Times (August 9), the correct position is that we are not recruiting staff into any position that has previously been made redundant.

We are recruiting for a small number of vacancies in our claims departments in Cheadle and London for individuals with various levels of experience and we are seeking to fill these.

We would be happy to consider any ex-employee of Independent who has the required skills and experience for any of these vacancies.

Interested persons should contact:
Independent Insurance
Personnel Department
5th Floor
2 Minster Court
Mincing Lane
Diane Bromley
Executive manager – personnel