The Lloyd’s market covers three floors of our building here at One Lime Street. Made up of 46* independent businesses, known as managing agents, the market is a hive of activity. Throughout the day, you will see brokers moving between desks, striking up conversations with underwriters and negotiating details of the risk their client has asked them to insure. The underwriters, meanwhile, will be using their initiative and experience to assess risks and make complex decisions on whether each risk can be insured – and how much it should cost.
Members and syndicates
If a a client makes a valid claim on a policy, they need to be sure that it can be settled. The financial backing (or capital) for this is provided by members of Lloyd’s. Today, our members are for the most part made up of large corporations, as well as individuals and limited partnerships, and are supported by members’ agents, who provide advice and administrative services. A member or group of members form a syndicate, which is then managed by managing agents in the market on behalf of the members providing the capital.
Managing agents
Managing agents are there to look after the interests of their syndicates (or groups of members) and conduct business on their behalf. To help them to do that, the managing agents employ teams of expert underwriters.
Each of the managing agents will compete with the others for business, and between them, they run and accept risk on behalf of over 75 syndicates**. Many of the businesses at Lloyd’s specialise in specific types of insurance – from marine or aviation insurance through to relatively recent areas such as cyber-liability, terrorism, and kidnap and ransom. As such, the Lloyd’s market brings together under one roof an unrivalled collection of expertise.
Underwriters
Underwriters are called underwriters because, originally, they would sign their name under a risk as a promise to insure a certain percentage of it. That description remains relatively accurate to this day. The underwriters you will see on the underwriting floors are professionals with a great deal of knowledge and experience in insuring risks, so they are able to calculate quickly and decisively how great any given risk is likely to be. We owe much of our reputation to their skill.
Brokers
These brokers, on behalf of their clients (who could be anything from large corporations through to private individuals), will come into Lloyd’s and 'shop around', taking a particular risk they want covered around the market to try to find the best price, terms and conditions by talking to the underwriters at various managing agents.
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Last updated on 25 Jan 2008
