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Norwich Union is being sued in the High Court for helping people to underwrite at Lloyd's of London.

A writ has been issued by 66 policyholders who suffered heavy losses as Lloyd's names and now face losing their homes.

They are among about 2,500 people who obtained guarantees from Norwich Union that allowed them to underwrite at Lloyd's. The guarantees were sold by Norwich Union before Lloyd's nearly collapsed from multibillion pound losses.

The guarantees were generally sold through intermediaries. They were used as proof of a name's ability to pay any debts, enabling Lloyd's to claim money from Norwich Union. Norwich Union is now seeking reimbursement from the names whose guarantees were called in.

The litigating names claim that the agreements are void. They claim that Michael Falcon, the then Norwich Union chairman, and Allan Bridgewater, the retired chief executive, knew that Lloyd's was massively exposed to asbestosis claims and reinsurance spirals. They claim that the two executives knew through their directorships of Norwich Winterthur Reinsurance and Stronghold Insurance, two Norwich Union subsidiaries, that the Lloyd's global exposure exceeded its known capacity and that Lloyd's had to continue recruiting new members or face collapse.

The names suing under the banner of the Norwich Union Action Group are also seeking damages.

A Norwich Union spokesman said the company was confident the legal claims would not succeed: "Norwich Union did not advise names on the merit of underwriting at Lloyd's. Names retained their own professional advisers for that purpose."

Norwich Union stopped issuing the property-backed policies in 1991, having been selling them since 1989. Its total exposure to Lloyd's guarantees was about £300 million.

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