Lloyd's overview

The Lloyd’s market houses an outstanding concentration of underwriting expertise and flexible pools of capital. It’s a dynamic environment with many different stakeholders.

Who's who?

Clients/Policyholders request insurance cover - Businesses, organizations, other insurers and individuals from around the world want to protect themselves against risks that could affect them. They approach a broker and explain their individual needs.

Brokers place the risks - Most of Lloyd’s business is placed with the assistance of a broker. In addition to being regulated by their national regulator, brokers also must also meet our own eligibility criteria. In the US, any surplus lines business transacted with Lloyd’s must be through a licensed surplus lines broker, and licensed or admitted business must be through a coverholder or open market correspondent.

Coverholders place the risks - Coverholders are companies authorized by a managing agent to enter into a contract or contracts of insurance to be underwritten by the members of a syndicate managed by it.

Service companies place the risks - A service company is an approved coverholder which Lloyd’s has classified as a ‘service company’ by reason of it being a wholly owned subsidiary of either a managing agent or its holding company.

Syndicates write the insurance risks - Underwriters decide which risks a syndicate will underwrite and on what terms. Much of Lloyd’s business is conducted in the Underwriting Room, where face-to-face negotiations take place with brokers regarding the risks they want to place at Lloyd’s.

Managing agents manage the syndicates - These are companies set up to manage one or more syndicates. The managing agent employs the underwriting staff and handles the day-to-day running of a syndicate’s infrastructure and operations.

Members provide the capital - Members of Lloyd’s provide the capital to support syndicates’ underwriting. Members include some of the world’s major insurance groups and companies listed on the London Stock Exchange, as well as individuals and limited partnerships.

Corporation of Lloyd’s supports the market - The Corporation oversees and supports the market and promotes Lloyd’s around the world. This includes determining the capital that members must provide to support their proposed underwriting, working with the management of underperforming syndicates to improve performance, undertaking financial and regulatory reporting for the Lloyd’s market, managing and developing Lloyd’s global network of licenses and the Lloyd’s brand.

Three of the world’s leading insurance rating agencies recognize Lloyd’s strengths and robust capitalization and the financial strength of the market. In 2009, all three rating agencies reaffirmed our ratings.

All Lloyd’s syndicates benefit from Lloyd’s central resources, including the Lloyd’s brand, its network of global licenses and the Central Fund. As all Lloyd’s policies are ultimately backed by this common security, a single market rating can be applied. The Lloyd’s financial strength ratings apply to every policy issued by every syndicate at Lloyd’s since 1993.

“Lloyd’s competitive position is strong, supported by the positive attributes associated with its unique brand, attraction as the world’s largest subscription market, London’s continued position as a major international insurance and reinsurance market, and policyholder loyalty. In our view, the impressive level of resilience that Lloyd’s has demonstrated to the events of the past 12 months further reinforces its attractiveness as an operating platform.”

Standard and Poor’s, October 2009

Lloyd’s began over 300 years ago in Edward Lloyd’s coffee house – a place where shipowners could meet people with capital to insure them.

Since then, Lloyd’s has grown from its marine insurance base to become the world’s leading market for specialist property and casualty insurance.

To this day, Lloyd’s remains a dynamic, innovative market where individuals meet face-to-face. Like any market, it enables those with something to sell – underwriters providing insurance coverage – to make contact with those who want to buy – brokers, working on behalf of clients who are seeking insurance. We gain our strength from the diversity of managing agents who choose to operate here, backed by capital from diverse sources around the world.

Lloyd’s has been a major force in the US insurance market for over a century – from the devastating San Francisco earthquake of 1906 to recent catastrophes such as Hurricanes Gustav and Ike.

Lloyd’s has continued to develop innovative coverage for the US market, such as excess of loss reinsurance, kidnap and ransom insurance, and bankers’ blanket bonds. In particular, the 20th century saw Lloyd’s provide insurance against natural catastrophes such as earthquakes and windstorms and, more recently, coverage for directors’ and officers’ liability and terrorism insurance. Throughout its long relationship with the US, Lloyd’s has provided American businesses with creative solutions for their risk management needs, and will continue to do so in the future.

Lloyd's produces a top-line and in-depth suite of literature, to suit the varying requirements of its many audiences. All the publications here can be downloaded as pdfs.

Lloyd's Quick Guide 2010

(US version)
A broad introduction to Lloyd's, covering history, structure, security, ratings and market statistics. Useful for anyone new to Lloyd's.

Click here to download a copy of Lloyd's Quick Guide 2010

Lloyd's Highlights 2010

(US version)
An overview of our operations, performance, strategy and security. Includes information about Lloyd's unique capital structure, often referred to as the Chain of Security.

Click here to download a copy of Lloyd's Highlights 2010