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Apollo Syndicate Management Ltd

Managing Agent Name: Apollo Syndicate Management Limited

Subject: General Update

Syndicate Affected: 1969

This statement has been prepared by Apollo Syndicate Management Limited (“ASML”) for the purpose of disclosing to existing and prospective underwriting members of Syndicate 1969 (the Syndicate) information which may be of relevance to such members in considering their participation for the 2019 year of account (“YOA”).

Members are also referred to the Business Plan Narrative for the 2019 YOA, other SBF documents, and the Syndicate’s latest quarterly returns, all of which have either been provided or are available to members (or their representatives as appropriate), and include information on various relevant developments within the Syndicate.

Syndicate Business Plans and Special Purpose Arrangement (“SPA”) 1971

Lloyd’s has agreed the 2019 Syndicate business plans for Syndicate 1969 with a capacity of £430m gross of SPA capacity. This is made up as follows:

SYN 1969         £250m

SPA 6133         £50m

SPA 1971         £130m

The business plans for SPA’s 6133 and 1971 have also been approved; and Lloyd’s Franchise Board has also granted Apollo “in principle” approval to establish SPA 1971, which will reinsure the new “IBOTT Rover” portfolio written by Syndicate 1969.

Open year forecasts

The forecast result on closure for the 2017 YOA as at Q2 2018 was a loss in the range of -12.5% to -22.5%.  Whilst there has been some adverse claims development (small movements across a number of classes) and new losses from Hurricane Florence affecting the year’s result, the current estimate is for the year to close within the existing forecast range.

The forecast result on closure for the 2016 YOA as at Q2 2018 was a loss in the range of -12.5% to -17.5%.  There has been some adverse claims development affecting the year’s result (small movements across a number of classes) which is likely to result in a deterioration of the forecast result on closure by approximately 5% on stamp capacity.

Both forecast ranges and point estimates are subject to final review and approval by the ASML board on 2 November 2018.  The forecasts and plans for 2018 YOA and 2019 YOA remain reasonable. 

Apollo will provide early sight of the Q3 QSR data once it has been submitted to Lloyd’s to enable members to better understand the impact on their solvency position at Q3.

Board changes

The following have been appointed as directors of ASML since the last announcement:

  • Matthew Newman – Executive Director, with effect from 15 December 2017

  • Martin Hudson – independent Non-Executive Director, with effect from 1 February 2018

  • Mel Goddard – independent Non-Executive Director, with effect from 1 February 2018

The following have retired as directors of ASML since the last announcement:

  • Jayne Owen – independent Non-Executive Director retired with effect from 31 December 2017

Ownership

On 13 June 2018, the Hyperion Group acquired a non-controlling 9.9% interest in Apollo Partners LLP, the ultimate parent entity for ASML.  Hyperion is not involved in the running of ASML and has no influence on the business written by ASML managed syndicates.

Lead Consortium Fees

To reflect the fact that Apollo does not receive a managing agency fee on the premium income written on behalf of the consortium partners, a proportion of fees received in respect of consortia led by 1969 are allocated to ASML.  This policy was adopted with effect from 2018 YOA and continues for 2019 YOA.

Connected Party – Apollo Underwriting No.5 Limited (“Apollo 5”)

Members are advised that Apollo 5 is a corporate member which participates on S1969.   Apollo 5 is considered a ‘connected person’ within the context of the Lloyd’s capacity auction framework by virtue of it being a 100% subsidiary of Apollo’s parent entity, albeit the underwriting is supported by third party FAL.  From time to time, Apollo 5 may participate in Lloyd’s capacity auctions as a tenderer or subscriber of capacity in respect of S1969.

Date issued: 22 October 2018

Contact Information

Agency contact name: Peter Bowden

Agency contact no: + 44 (0) 203 169 1975

For auction office use only: D2018010

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