Glossary

Capacity

This term may refer to: (a) a member’s allocated capacity (b) syndicate allocated capacity (c) the total underwriting capacity of all syndicates combined; or (d) the underwriting capacity of an insurance company or reinsurance company.

Capacity auction

A procedure which allows a member to sell his participation rights in one or more syndicates for the following year of account to one or more other members, a managing agent or a members’ agent operating a MAPA by means of electronic bidding at specific times. Individual members and some corporate members buy and sell capacity through their members’ agents.

Capital provider

As regards a Lloyd’s syndicate, its member(s). As regards a company, its shareholders.

Carrier (of risk)

An insurer or reinsurer.

Cash call

A request for funds made by a managing agent to members of a syndicate.

Casualty

Refers to a loss, particularly the loss of a ship.

Casualty book

A book which stands in the centre of the underwriting room and which records details of vessels which are or are likely to become total losses. The entries are made a by Lloyd’s waiter using a quill pen.

Casualty business

Another term for liability insurance.

Cedant

A syndicate or company that transfers a risk exposure under a reinsurance contract.

Cedant’s line

The retention under a surplus lines treaty.

Cede

To transfer a risk exposure under a reinsurance contract.

Central accounting

A facility is that is operated by the Corporation of Lloyd’s whereby sums due to and from individual Lloyd’s brokers and syndicates are processed centrally and their accounts debited and credited on a net basis regularly. Urgent one off payments may be made more quickly.

Central Fund

See New Central Fund.

CentreWrite Limited

A subsidiary of the Society that is permitted to underwrite run-off reinsurance contracts for syndicates in run-off and estate protection reinsurance for Names.

Certificate of insurance

Depending on the context this term may refer to: (a) A document which evidences the existence of insurance cover but which does not detail all its terms which are contained in a separate policy of insurance. Certain certificates are required as a matter of law in the United Kingdom, for example for motor insurance. (b) A document that is issued by a coverholder which evidences the existence of insurance cover and details the terms of such cover. No policy of insurance is issued where such a certificate is issued.

Cession

A particular risk exposure that is transferred under a reinsurance treaty.

Claim

Depending on the context this term may refer to: (a) a demand made by a policyholder on his insurer(s) for payment or some other contractual benefit under an insurance policy; (b) a demand made by an insurer on its reinsurer(s) to be paid under a reinsurance contract; or (c) a demand made by a third party on a policyholder to be compensated for some injury, damage or loss for which the third party blames the policyholder. A claim is payable under an insurance or reinsurance contract if it is caused by an insured peril and it is not excluded under the terms of that contract.

Claimant

The person making a claim.

Claims made policy

A policy which only pays claims that are notified to the insurer during a specified period.

Claims notification clause

A clause in an insurance or reinsurance contract which sets out the procedure that the insured or reassured must follow in order to make a claim under the contract. Such clauses frequently provide for prompt notification of claims and events which may gives to claims in the future.