Gooda syndicates attacked: Underwriting systems 'thoroughly inadequate', says names' witness
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Your support makes all the difference.THE UNDERWRITING systems used by Gooda Walker syndicates were criticised in the High Court as 'thoroughly inadequate' by Ulrich von Eicken, an expert witness for the names bringing the action.
Bernard Eder QC, counsel for the defendants, said Mr von Eicken, former head of Munich Re in London, was misleading the court about his expertise because he had not written the same class of business as the Gooda Walker syndicates. Mr von Eicken said he had made it perfectly clear that Munich Re had not reinsured catastrophe excess of loss business. 'That business was unduly dangerous to write,' he said.
Mr von Eicken suggested that the handful of Lloyd's syndicates involved had shown they knew much less about the business than those who decided not to write it.
Geoffrey Vos QC, for the names, asked Mr Von Eicken to respond to the additional criticism that evidence from Munich Re was not relevant because it was a big business while Lloyd's syndicates were much smaller. Mr Von Eicken said: 'I cannot really accept that a group of syndicates like Gooda Walker, that between them were writing pounds 200m in premium income, were acting like a corner shop. And if they were, they shouldn't have been.'
Mr von Eicken said in written evidence that if basic underwriting principles had been followed, losses to the names could have been avoided. He criticised the Gooda Walker underwriters for poor planning and inadequate information: 'You don't just go around guessing and hoping that everything will be alright.'
He attacked the underwriters for blaming their syndicates' losses on a series of catastrophes. Mr von Eicken said: 'If you are in the catastrophe business, you can not possibly base your activities on there not being a catastrophe.'
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