This page provides an overview of the principal Lloyd’s costs. It provides information on the Lloyd's application fees for members, syndicates and managing agents and certain ongoing annual charges.
These costs are for 2020. We review our charges annually and every September we issue a market bulletin setting out the charges for the following year.
This page does not include:
- The day to day running costs of your business
- FCA/PRA fees
- New corporate member application - £52,000
- New SPA application - £75,000
- New syndicate in a box application - £100,000
- New syndicate application - £200,000
- New managing agent application - £300,000
No VAT is charged on these amounts
If you are applying to set up a new member, you will need to pay the application fee when you apply.
Syndicate, SIAB, SPA and managing agent fees are payable when proposals are submitted for "in principle" approval.
These fees are not refundable.
1) Members’ subscriptions
Members pay 0.36% of their gross written premium (GWP) in subscription fees. A member’s gross written premium is their gross premium before deductions
These fees are collected from members’ premiums trust funds by managing agents. No VAT is charged on these amounts.
2) Central Fund contributions
The annual Central Fund contribution rate payable by all members, (other than new corporate members underwriting on new syndicates), is 0.35% of GWP.
Lloyd’s is included in the Financial Services Compensation Scheme (FSCS). The Central Fund currently covers the cost of any possible FSCS compensation contributions. We review this every year.
New corporate members pay 1.40% of GWP if they support any of the first three years of account on a new syndicate. If a new member writes on a mix of existing and new syndicates, then the higher rate will only be payable in respect of its participations on the new syndicates. A new member is defined as one which is in its first three years of underwriting.
New corporate members supporting syndicates in a box have the option to pay the standard Central Fund contribution of 0.35% GWP (rather than 1.4%) for the first 3 years. They will be required to pay the difference of 1.05% in years 4 to 6, based on the GWP in years 1 to 3, if the member(s) continue to underwrite.
Initial payment of contributions on account will be based on the GWP forecast within the syndicate business forecasts and subsequently adjusted to gross written premiums. For the purposes of adjustment, gross written premiums for a year of account will be determined by the audited annual syndicate returns.
The Central Fund contribution rate is reviewed annually.
3) Central Fund contribution – Callable layer
If it is necessary to meet the liabilities of the Central Fund, subject to Council and members’ approval, we may charge all members an additional contribution. This may be up to 3% of a member’s capacity. A member’s capacity is the maximum amount of insurance premiums that each member can accept.
In addition to these contributions, the Council may also make additional charges to members if necessary to supplement the Central Assets of the Society. This is set out in the Powers of Charging Byelaw.
Managing agents’ fees
Managing agents determine charges payable by members for managing the syndicates they participate in. These charges are normally made up of two elements:
- A fee
- A profit commission
Fees vary from managing agent to managing agent but normally sit in the range of 0.5% to 1% of a syndicate’s capacity. A syndicate’s capacity is the combined total of each member’s capacity allocated to that syndicate.
A profit commission is normally charged on the profit of a syndicate that has generated for a particular year of account. In some cases, the profit commission rate may be scaled to levels of profit.
Members’ agents’ fees
If a member employs a members’ agent, they will pay that members’ agent a fee. This fee may be a fixed amount or a percentage of the member’s capacity. A members’ agent may also charge a profit commission.
General overseas charges
We charge each syndicate a percentage of its gross overseas premiums. This is to cover the costs of our overseas operations and any UK costs associated with them. For example, in the case of the United States, this includes the fees we pay the US counsel to protect our general trading position.
You may need to pay Lloyd’s the cost of direct and indirect taxes, if they apply to your business. You should consider this in your business planning, as well as taking into account the costs of processing business at Lloyd’s.