RECRUITMENT OF SMALL INVESTORS BY LLOYD'S

EDM number 661 in 1991-92, proposed by Brian Sedgemore on 12/02/1992.

That this House is concerned at the reasons behind the recruitment of small investors in the 1980s with only a bank guarantee of ú100,000 on their house; wonders why Lloyd's allowed small investors to be dragged into membership on the basis of receiving a 'protected' 10 per cent. return on ú250,000 underwriting in year three with the recruiting agent arranging a mortgage to cover the Lloyd's ú3,000 joining fee and the first three years of stop loss premium; wonders why Lloyd's encouraged financial 'advisers' to earn ú1,000 for each member they introduced plus 10 per cent. of the member's agent's subsequent salary and profits; and is concerned that this might be because Lloyd's had a warning from the unpublished Yale University report at the beginning of that period that huge claims were coming from the United States of America for the predicted 265,000 American asbestos deaths over a period of 25 years and because Lloyd's wanted to find a pool of new people to absorb the claims on Lloyd's past insurance business for which others had taken premiums in the 1950s and 1960s.

This motion has been signed by a total of 27 MPs.