Lloyd?s to sue Aon, Benfield over US terror claim
LONDON (Bloomberg) ? Lloyd?s of London, the world?s biggest insurance market, said it will sue brokers Aon Corp. and Benfield Group Plc for ?325 million ($577 million) for payment of a claim related to the September 11, 2001, terrorist attacks.
?We are now actively pursuing this claim through the courts,? said Lloyd?s General Counsel Sean McGovern in a statement last week.
?This is not a decision that has been taken lightly and follows discussions with Aon and Benfield.?
Lloyd?s brought the action after settling a claim last March against six insurers, including Swiss Reinsurance Co., for ?152 million related to losses from the terrorist attacks in the US Chicago-based Aon, the world?s second-biggest insurance broker, and Benfield placed the policy that insured the market?s central fund, which covers losses in case a Lloyd?s member is unable to pay claims, according to a spokeswoman for the market.
Benfield and Aon rejected the lawsuit?s claims. Aon is ?disappointed? that Lloyd?s decided to pursue legal action, said Sebastian St. John-Clarke, a London-based spokesman for the company. ?We do not accept that Lloyd?s has a valid claim against Aon,? he said in a telephone interview. ?We will be contesting it vigorously.?
Benfield, a UK reinsurance broker, also rejected the claim in a Regulatory News Service statement last week.
The London-based company added that the claim wouldn?t result in a ?material liability? to the broker.
Lloyd?s declined to provide details of the lawsuit and said particulars will be filed next month. The case may take 18 months to come to court, Lloyd?s said.
Lloyd?s may show its first annual loss since the 2001 terror attacks when it reports 2005 results in April. Last year?s costliest hurricane season on record triggered claims of about ?2.9 billion. The September 11, 2001, attacks cost Lloyd?s about $3.3 billion.