The largest independent travel intermediary Travel Protection Group (TPG) is in crisis talks.

TPG associate director Philip Watson said the company was in talks with interested parties with the "view to restructure in 2003". He assured policyholders that policies would still be covered and said TPG was still taking on new business.

An industry expert said the decision was made two weeks ago in a crunch board meeting where it emerged that the company was running out of money. The sales teams and business development directors were allegedly told not to spend money on travel, so essentially could not go to see clients.

The source suggested TPG was "top heavy" after acquiring other intermediaries. He also said TPG lost its finance director last month. "He left under a black cloud and the accounting was allegedly wrong," he said.