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Captive syndicate

“I want to underwrite my own risks, or risks that I partially control, at Lloyd's.”

What is a Captive syndicate?

A Captive Syndicate is a type of Lloyd’s syndicate set up by a group enterprise seeking to retain first or related third party risks:

  • First party: An insurance policy where the claimant is the parent entity or group.
  • Related Third Party: Products offered to a limited population affiliated with the group such as employees, customers, contractors or partnerships. These risks are either better understood by the group, or the group has some degree of control, risk mitigation or alignment of incentives.
  • Third Party business is not permitted to be written into a Captive syndicate.

Why establish a Captive syndicate?

  • Licensing access leads to potential cost efficiency: All syndicates at Lloyd’s, including Captive syndicates, can use Lloyd’s international underwriting permissions, including the ability to underwrite direct insurance in 80 countries, and to use fronting partners where Lloyd’s does not have insurance permissions. A Captive with a significant volume of business in multiple territories where Lloyd’s has permission to underwrite insurance can find this a more cost-effective model.
  • Control and consistency: The potential absence of fronting arrangements provides the Captive with the ability to set and control their own risk appetites, retentions and wording, with the support of their managing agent, and the oversight of Lloyd’s.
  • Capital: Captive syndicates share the financial strength rating of the Lloyd’s market. This can result in lower collateral requirements where fronting arrangements are necessary.

Lloyd’s assessment criteria

Lloyd’s has established overarching criteria for the assessment of all new entrants; these criteria are provided for by the Underwriting Byelaw and are set out in full in the requirements made pursuant to the Underwriting Byelaw.

More broadly, Lloyd’s will also consider the extent to which the applicant’s proposed business adds value to the Lloyd’s market having regard to:

  • the nature and robustness of the business plan of the syndicate;
  • whether the applicant is a competent, proficient and capable organisation;
  • whether the applicant is of appropriate reputation and standing;
  • whether the applicant has adequate capital and financial resources;
  • whether the applicant is able to meet Lloyd’s Principles framework where applicable; and
  • the applicant’s support for ‘Future at Lloyd’s’ and other market wide initiatives.

Fees and charges

  • Lloyd’s Captive syndicate application fee is £100,000 (VAT is not payable).
  • The application fee invoice will be issued once the application has been recommended to the Council by the Business Opportunities Committee.
  • Please note the application fee is non-refundable.
  • Further information on charges payable by members to operate in the Lloyd’s market can be found in the Triage Quantitative Submission.
  • We review our charges annually and every September we release a Market Bulletin confirming the charges for the following year.

Next steps

Download the Captive syndicate Guide to find out more about our assessment criteria and how to apply.

Useful resources

You can find all the materials required for your application, including templates, by visiting the Useful resources page.