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The Lloyd’s Market

At the time of writing the Lloyd’s Insurance market has 57 managing agents that represent 93 syndicates (who are effectively separate Insurers, albeit operating under the Lloyd’s brand), which offer an unrivalled concentration of specialist underwriting expertise and talent.

Business written at Lloyd’s is still conducted on a “face to face” basis and the bustling Underwriting room is central to the unique nature of the market. The Lloyd’s market structure encourages innovation, speed and excellent terms, which make it attractive to clients and participants alike. The usually immediate decision process means risks can be presented and quote quickly and efficiently, enabling the broker to provide fast and competitive solutions in response to the clients’ requirements.

The majority of the business written at Lloyd’s is placed through Lloyd’s brokers and/or Lloyd’s Coverholders who facilitate the contract of insurance between the clients (policyholders) and Underwriters (Insurers). Clients can communicate their insurance requirements either to a broker, who approaches specialist underwriters who are employed by syndicates and request they quote the terms and, if acceptable, underwrite the risk on behalf of their clients, who become Insureds (Policyholders).   Any claims in relation to the Insurance contract are then handled by their professional claims teams.  In the case of a Coverholder it is usually not necessary to approach an Underwriter. (A full explanation can be seen below).

Clients (both corporate and individual) request insurance to cover their interests against the risks that could affect them. They approach a broker or a Coverholder who then obtains terms on their behalf.

Lloyd’s Brokers place the risks in the Lloyd’s market on behalf of their clients. These brokers use their specialist knowledge to find the most suitable Insurers and then negotiate competitive terms and conditions on behalf of their clients. Currently there are over 180 firms of brokers working at Lloyd’s, many of whom specialise in particular types of risk. All brokers who “broke” in the Lloyd’s market have, for many years, been required to demonstrate their understanding and knowledge by sitting a Lloyd’s exam. In addition they are required to undergo regular training to ensure the highest possible standards are maintained.

Lloyd’s Coverholders accept risks on behalf of the Managing Agents who have provided them with a specific authority under which they can accept business. They can therefore usually quote terms to the clients without having to contact the Insurers. They are then authorised to issue insurance documentation on behalf of the Insurers. If a risk does not fall within the agreement granted, a Lloyd’s Coverholder can also act as a broker and submit the risk to a Lloyd’s broker for submission to Insurers.

Lloyd’s Syndicates are the Insurers who cover the risks and are capitalised by one of more capital providers, who have unlimited liability for the risks written by the syndicate. Traditionally their capitalisation was provided by individual members of Lloyd’s, who were referred to as “names”.

However, now nearly all the capital is provided by large corporate organisations, who are often international Insurance entities in their own right. The size of the risks will determine how many syndicates participate in the Insurance coverage.

Should any syndicate ever be unable to pay for all its liabilities in the form of claims, which has happened very rarely in Lloyd’s 400 year history, there is a Lloyd’s central claims fund that will respond.  Lloyd’s has always paid recoverable claims!

The separate Lloyd’s syndicates provide different insurance solutions at varying conditions and prices and can therefore respond to the specific needs of the constantly changing and evolving client base. They are also competing for the business and therefore offer choice, flexibility and continuing innovation. Each Lloyd’s syndicate employs a number of knowledgeable underwriters who write specific classes of business. This means the Lloyd’s market has the greatest underwriting expertise in the world!

Lloyd’s Managing Agents are the companies who set up and manage one or more Lloyd’s syndicates on behalf of their capital provider(s). The Managing Agent not only runs the syndicates under their control, but also ensures that all regulatory and compliance issues are taken care of.

The Corporation of Lloyd’s provides the central location for the participants to operate (known as “The Room”), but also oversees and supports the Lloyd’s market.  In addition they promote the Lloyd’s brand around the globe which enjoys the most extensive geographical areas where it can trade.

Lloyd’s Coverholder –  Prodromou & Makriyiannis

Prodromou & Makriyiannis Insurance Underwriting Agencies & Consultants Ltd benefit from a wealth of experience and years of successful operations, focusing on quality of service combined with tried and tested security for their clients’ peace of mind.

Our insurance activities date back in the late 1940’s and our company was originally established in 1969 with head offices in Cyprus and now in London.  We are Lloyd’s Coverholders and operate several Binding Authorities in different classes of business on behalf of Lloyd’s Managing Agents. In addition we are appointed agents for a number of other European Insurers and international brokers.

We offer insurance coverage ranging from standard policies for individual clients to complex solutions for commercial organisations.