Insurance broker Towergate and its new owners have agreed to pay £20 million to settle a series of breach of contract cases after claims it poached several executives from US rival Arthur J Gallagher.

New chief executive David Ross will join the Maidstone-headquarted firm in November after the legal proceedings, which began in March, were brought to an end.

Towergate agreed to pay £4 million this month and another £4 million in April next year, with majority owners Highbridge Capital stumping up the other £12 million.

Arthur J Gallagher opted to sue various employees individually after its former chief executive Mr Ross jumped ship to the struggling UK broker – eventually bringing much of his executive team with him.

It means interim chief executive Scott Egan will be allowed to leave Towergate next month to become chief financial officer at RSA Insurance Group.

Adrian Brown, the former execuitve chairman of Arthur J Gallagher, will take up the reins as chief executive for six weeks until Mr Ross arrives, when he will then become chief operating officer.

“I am very pleased that a settlement has been agreed between a number of incoming executives and Gallagher, bringing much needed clarity to the management of the Towergate business..." - John Tilner, Towergate chairman

John Tilner, the former city regulator, will become Towergate’s new chairman.

He said: “I am very pleased that a settlement has been agreed between a number of incoming executives and Gallagher, bringing much needed clarity to the management of the Towergate business.

“With all of these appointments alongside our existing leaders we will have an outstanding executive team, whom I am confident will lead the business to sustained success in the future.

“I am very grateful to Scott for everything he has achieved at Towergate over the last four years. He successfully steered the business through the financial restructuring, galvanised our people during a vulnerable period and oversaw some major changes to the business.

“His commitment to Towergate has been exemplary. We wish Scott all the best in the next phase of his career.”

Earlier this week it was revealed Towergate lost £58 million in the first half of the year, as it continues to be affected by a financial restructuring of more than £1 billion of debt.

It employs 4,400 people across 100 UK offices, including others in Sevenoaks and Whitstable.