Frequently Asked Questions
As reported in the Half Year Results for 2020, Lloyd’s has incurred COVID-19 losses as at 30 June 2020 of £2.4bn and the estimated net ultimate loss to the Lloyd’s Market is expected to be £3.0bn. Reported losses are in line with the preliminary loss estimate figures for COVID-19 published May which projected that Lloyd’s is set to pay out in the range of £2.5bn to £3.5bn to its global customers, as a result of the far-reaching impacted of COVID-19.Read the full details of the loss figure announcement in our press release
Read the full details of the Half Year Results 2020 online
Underwriting Room and Emergency Trading Protocol
We’re reopening the doors of the Underwriting Room on 1 September 2020. Our number one priority is keeping the market and our employees safe, so we have allowing the market and your employees to connect and collaborate safely and productively. To do this we have introduced a number of new policies and procedures in place to ensure this.
Although the Room will look a little different for a while, we feel confident that the right systems solutions are in place to ensure that face to face business in the market can continue efficiently, effectively and safely.
We have published our return to the Underwriting Room guidance with the market. This details the processes and procedures we have implemented to ensure that the building is COVID-19 secure.
You can download this guidance from our welcome back to the Lloyd's building page
If you are a managing agent or a broker and require further information, please contact us at firstname.lastname@example.org.
Delegated Authority guidance
As with policy renewals, we are aware that there are currently challenges in completing the renewal of binding authority arrangements and we would say again it is preferable that binding authorities are renewed rather than extended. However, where current operational restrictions impede the ability to effect renewal then underwriters should consider an extension to the binding authority. Underwriters may give such an extension even if this extends the overall binder period to more than the current limit of 18 months (or 36 months if a three-year binder). You can find out more in our delegated authority guidance section.
Where the local regulation has been temporarily revised in response to current circumstances and these now provide the Coverholder with longer timeframes than the Lloyd’s minimum standard, then it may be appropriate for a managing agent to adjust your oversight to monitor that the local
regulatory standards are achieved and have an appropriate plan to ensure that Lloyd's minimum standards are achieved as soon as possible.
Where revisions to local regulatory requirements have not been made and in circumstances where the Coverholder is unable, at present to meet the Lloyd’s minimum standard even when allowing for a short, reasonable extension, then the managing agent should discuss this with their Lloyd’s Customer Oversight Manager.
If you are a coverholder who cannot meet the agreed policy issuance timeframes then you should contact your managing agent as soon as possible to discuss the appropriate course of action. If you are a policy holder who has not received your policy then you should contact your broker directly and raise this with them. Should you not be able to resolve the matter satisfactorily please contact Lloyd's on email@example.com.
· We expect the lead managing agent on a binding authority to be responsible for the binding authority renewal compliance due diligence in accordance with the ‘Code of Practice – Delegated Authority’.
· Currently, binding authority contracts need to name each individual who has authority in the coverholder to bind risks, issue insurance documents or settle claims. With immediate effect, only the individual(s) with overall responsibility for the binding authority (i.e. those who would be named in section 3.1 of the model binder wording) must be named. You can find out more in our delegated authority guidance section.
Different territories, for example the US, have issued specific guidance on this which can be found with all the latest legal and regulatory guidance on Crystal.
Managing agents should also ensure that any decisions made around premium refunds align to Lloyd’s Minimum Standards, in particular MS9 – Customer.
Financial Conduct Authority
Supporting our people
We are ensuring the communications with our employees from our CEO, John Neal, are regular, thoughtful and informative. This includes regular email updates and a weekly CEO vlog in which John keeps everyone in the loop and shares his thoughts on the prior week/week ahead.
We understand that not everyone is set up for effective homeworking and it’s important to us that our employees have access to suitable and appropriate furniture and technology. We have asked all employees to assess their own situation and purchase additional equipment – and we will cover the cost.
In addition, we have accelerated our plans to address wellbeing to ensure our employees have the support they need at the right time. We have partnered with Headspace to provide new tools to help employees start practicing mindfulness and meditation. We’re also sharing great resources with our employees from external providers, such as the NHS’ Every Mind Matters site which aims to support mental health during this period with lots of scenarios, tips and advice. We have introduced a wellbeing section on Lloyd’s University which has a range of tools and resources designed to help us adapt and cope in these challenging times.
Lloyd's would remind managing agents of the following
1) A managing agent should not adopt a policy of automatic cancellation from inception for failed payments after 60 days and due consideration should be paid to the circumstances of each individual case to ensure that any such cancellation would be fair and reasonable. Due consideration should be given to the implications of cancellation from inception specific to first party and third party policies
2) Where a cancellation from inception is considered appropriate or a customer requests this then the managing agent should ensure that the policyholder understands what this means in clear understandable language. Any communication to policyholders should clearly articulate what is meant by the terminology used.