The Lloyd's Market
Understanding The Lloyd's Market
Established in a coffee house in the 17th Century, the Lloyd's market is now a world-renowned space where companies arrange specialist insurance for customers with complicated or unusual risks.
The market houses syndicates with an unrivalled concentration of expertise, which provide the capital for underwriters to accept risk. Most of the business written at Lloyd’s is still conducted face-to-face in the world famous Underwriting Room at our London Lime Street headquarters.
First things first, Lloyd's is not an insurance company. It's also not a bank.
The Lloyd’s Corporation is a group of nearly 1000 people across the world who oversee and regulate the world’s largest specialist insurance market. Lloyd’s operates in over 200 territories, with London as its epicentre. Based in the iconic Lloyd’s Building, the Corporation gives a home to 58 managing agents and 96 syndicates, offering an unrivalled concentration of specialist underwriting expertise and talent.
Now, imagine you want to insure something like a manned mission to Mars. You can’t go to your local insurance company and ask for a quote.
That's where Lloyd's comes in.
To start with, a broker will bring a risk into the market and approach a syndicate which specialises in the relevant class of business. Providing the underwriter is willing to offer insurance, they will agree the extent of cover which is to be offered, the premium (the price for the cover) and the share of the risk (the line) the underwriter is able to cover.
Syndicates provide the capital, so when an underwriter accepts a risk, they do this on behalf of the syndicate. This means that for something huge – like a mission to Mars – the risk decreases.
As a Corporation, Lloyd’s oversees that risk, making sure that all parties know the rules, comply with regulations and are operating in a way that keeps Lloyd’s at the forefront of innovation.