The main reason Bret had issues was that several guys had openly abused the system in the early to mid 90's. Notably Curt Hennig.
The idea is that you could insure yourself at Lloyds for unique things, like your smile, your hands if you were a pianist etc. Some wrestlers took out policies to cover their bodies in the event of being unable to work in the ring any longer due to injury. As has been stated, surgical procedures were not as advanced and there were no guaranteed deals. You didn't work, you starved - especially if you're back etc was wrecked. They could also cover you if you got an injury like Brian Adams/Crush did in 93 - where you're legit out for a year. Vince wasn't paying guys back then like he does today - so to keep your lifestyle going, fund rehab and stay afloat the policies were useful.
The first 2 high profile cases were Curt Hennig and Animal.
Animal was out for 2 years on his yet Hennig was "active" as an "Executive Assistant" for Ric Flair within months. What he was doing was still VERY close to the definition of his "retired" job.
He didn't "work matches in the ring", but was still involved in physicality from the outside during much of that late 91/Early 92 period.This irked Lloyds and they began the process of tightening up on payouts to wrestlers as it was clear that injuries could in some cases not be as bad as they seemed or that far from being "unable to work"they could simply move out of matches and into other positions and still make an honest (albiet reduced) living.
Remember when Perfect suddenly became "just a commentator" rather than being involved with Flair? Mainly as a host on Prime Time? That was cos Lloyds would no longer pay out if he was an "active" character in matches and reduced his payout. It got to the point it wasn't in his financial interest not to return to the ring, so he did and then tried to claim he had aggrivated the injury to reactivate the payouts/get out of WWE around 1993. That worked to get him out the WWF deal but Lloyds were wise and lo and behold, he shows up at Mania X as a ref for the Luger/Yoko match and then does the commentary thing which by then Lloyds had cleared but soon after again, he's suddenly involved in matches again during the Marc Mero angle and planning an in ring comeback.
It's said that someone in the company informed Lloyds of this, perhaps as a threat against trying to go to WCW and they finally stopped paying Curt altogether. It was clear he COULD wrestle if he chose to.
Once he signed the WCW deal it was academic as he was then on guaranteed money and the need to show the severity of his injured back reduced.
Rick Rude claimed and stayed fully retired for 4 years, then returned in a similar way for ECW, then WWF then WCW and again was involved onscreen in an active role.
This kind of abuse led to the situation Bret faced, where a legit, career ending injury was being probed and assumed fake. Also bear in mind Bret's policy would be MUCH higher in value than the others. He was on 3m a year at WCW and would have expected to re-sign for at least 2m for another 3 years at the time, for either company. So his payout would be higher than any of the others and one the company didn't want to pay out on until it REALLY had to. When Bret returned for that one off in 2010 - it had to all be cleared through Lloyds to avoid legal trouble for Bret and them cancelling the payouts. They clearly DID sign off on it, but it's likely Vince was having to pay them or Bret rather then them for that time period.
Lloyds also had some financial trouble itself back around 1996 linked to asbestos claims, it nearly collapsed - all of this contributed to the situation where today, they won't insure wrestlers at all.