Names face bankruptcy under new Lloyd's strategy
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Your support makes all the difference.LLOYD'S of London confirmed yesterday that it is planning a new 'get tough' policy with its names that threatens to bankrupt hundreds of individuals.
Angered by reports of names who 'can pay but won't pay', Lloyd's will launch a campaign in September to attempt to force names to meet their liabilities. Bankruptcy will be used as a last resort.
At least 51 members of parliament are known to have sustained losses at Lloyds, although the scale of the losses and the MPs' ability to pay is not known. Bankruptcy would be particularly damaging to an MP, who would have to resign the seat.
A spokesman for Lloyd's said yesterday that the authorities had written to 100 names in February demanding they pay their liabilities, but there was no limit to the number of people who would be pursued. 'It could be 200, it could be 1,000,' he warned.
The need for a 'gloves-off' strategy was announced on 4 August, and the final plan will be presented to Lloyd's council on 14 September.
The proposal follows the recruitment of two new advisers chosen specifically for their debt-chasing skills. Bernard Bradford, former head of NatWest Bank's corporate recovery department, and Phillip Holden, a solictor with Dibb, Luton & Broomhead, an insolvency practice, are putting together a scheme to chase names' hidden assets.
The Lloyd's spokesman said that the council had received increasing evidence that while many names have struggled hard to meet their obligations, others have deliberately not paid up despite being able to do so.
There have also been reports of names hiding assets from Lloyd's. Some have not even contacted the market for up to four years.
'We're not prepared to put up with this,' the spokesman said.
Until now the insurance market's authorities have been at pains to avoid bankrupting names, preferring instead to negotiate settlements through the Members' Hardship Committee.
In February a letter was sent to 2,700 names who owe pounds 500m in unpaid losses. The letter demanded that the names either contact Lloyd's or face legal action. Of these, 1,100 failed to reply.
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