Subject: Staff Pre-emption
Syndicate(s) Affected: 2791
TEXT:
The Syndicate Pre-emption Byelaw provides that a managing agent may allocate up to 2 per cent of the capacity of a syndicate to its agency staff every year, provided that it receives the approval of members whose syndicate premium limits in the aggregate are not less than three quarters of those members who notified their approval or disapproval . MAP has received support from both members’ agents and direct participants accounting for over 80% of the total syndicate premium income limit. For the 2012 year of account MAP has received requests from a cross section of staff for capacity on syndicate 2791 in the region of £3.2m.
Capital providers are advised that MAP has entered into a Memorandum of Understanding with one Members’ Agency regarding the operation of Staff Pre-Emptions on Syndicate 2791. The Members’ Agent concerned supports the principle of the underwriting and management team increasing their alignment of interest with third party Members through the allocation of staff pre-emption capacity, on the basis that Managing Agency Partners Ltd continues to operate on the basis of a traditional third party agency with no plans to become an Integrated Lloyd’s Vehicle. The intention behind the agreement is that staff Members will underwrite their staff pre-emption capacity for the long term subject to their personal circumstances.
The specifics of the agreement are:
1. MAP has previously allocated 1.947% of capacity on Syndicate 2791 through the staff pre-emption provisions. MAP will allocate a further staff pre-emption of 0.053% for 2012 bringing the total allocated to 2% of 2012 capacity. Such capacity will have no restrictions attaching to it.
2. Future MAP requests for staff pre-emption capacity will be made on an annual basis, assuming there is demand for such capacity, subject to the 2% annual limit specified in the Syndicate Pre-emption Byelaw. For 2012 MAP has requested and received approval for up to a further 2% of staff pre-emption capacity. In future, such requests will include an estimate of the likely amount of capacity that will be taken up. For 2012, MAP has received requests from staff across the business for a potential £3.2m or 0.63% of additional capacity.
3. MAP agrees to disclose to the Members’ Agency concerned the names of individuals benefiting from the staff pre-emption and the capacity allocated, broken down across all years of account, once the arrangements have been finalised following the Coming into Line deadline each year.
4. In the event that a company in the same corporate group as Managing Agency Partners Ltd acquires underwriting capacity on Syndicate 2791, any capacity allocated to staff under the staff pre-emption capacity in excess of the first 2% referred to above in paragraph 1 will lose the voting rights attaching to that capacity.
For the avoidance of doubt in relation to paragraph 4 above, while for the purposes of its Stakeholders’ Report, Lloyd’s classifies MAP Capital Ltd as aligned with MAP Holdings ( the owner of Managing Agency Partners Ltd) due to the fact that MAP Capital Ltd and MAP Holdings Ltd have some common shareholders, the corporate group test at paragraph 4 requires the shareholding to be at corporate level between any company or corporate group with a Member on Syndicate 2791 and the group of companies which includes the managing agent, Managing Agency Partners Ltd.
Date issued: 4 November 2011
Contact Information
Agency contact name: Siobhan McAuley/Anne Mount
Agency contact no: + 44 (0)207 709 3860
For auction office use only: D2011028
