POLICIES: A Dublin insurance underwriter has been unable to renew the policies of about 45 hackney drivers since the start of the year.

ARB Underwriting Ltd said it had advised insurance brokers to seek alternative cover for drivers whose policies lapsed after December 31st, but said many may have been forced to avoid driving altogether.

It is illegal to drive without insurance and the matter is particularly sensitive for hackney drivers because they are regarded as "high risk" by the insurance industry.

ARB's failure to renew policies was criticised by the president of the National Private Hire and Taxi Association, Mr Christopher Humphrey. He said: "We would be very disappointed that members of our association would be affected by this although we haven't had any complaints yet. I would have thought that they would have had an obligation to organise this before now."

An ARB director, Mr John Kennedy, said the problem had arisen because a syndicate of Lloyds insurers, Ace Global Underwriters, had withdrawn from the motor insurance business. Ace's departure did not affect drivers whose policies were renewed before the end of the year, he said. But any policies that lapsed since had not been renewed.

Mr Kennedy said individual motorists whose policies were underwritten by ARB were also affected by the change.

ARB does not deal directly with motorists and secures business through a network of brokers. It provides insurance to "high risk" drivers, such as those previously involved in accidents or who have endorsements on their licences for example. It also insures drivers of high-performance cars.

ARB had a "verbal agreement" with a new syndicate, but the company was unable to finalise a deal before the Ace syndicate ceased renewing policies.

Mr Kennedy said the company anticipated signing a formal agreement with the new syndicate today."We're really depending on third parties to get together and sign on the dotted line."

Ace indicated last April that it wanted to exit the business, he said. When asked why ARB had failed to secure alternative cover despite having eight months to do so, Mr Kennedy said intensive activity in the reinsurance market since September 11th had squeezed out companies with smaller contracts to offer.