Insurance underwritten at Lloyd’s of London: history and current arrangements: current working arrangements
Members, whether individuals or corporate, group together to form syndicates in order to accept insurance risk.
Risks at Lloyd’s are placed through brokers who shop around for insurance on behalf of their clients, and the types of insurance that can be purchased have widened out from just marine insurance to virtually all types of general insurance and reinsurance and some life insurance.
Under Lloyd’s Act and byelaws, members of Lloyd’s form themselves into syndicates to underwrite insurance. Each member, whether a company or person, underwrites on a several basis and is responsible for their own share of any profits or losses. Members may choose to participate in a number of different syndicates. Each syndicate comprises one or more members and is managed by a Managing Agent.
Each syndicate has a ‘Managing Agent’, who is appointed to manage its affairs. Employees of the Managing Agent undertake administration functions in relation to the insurance risks. Managing agent employs professional underwriters to underwrite risks on behalf of the syndicates.
Individual members including Scottish Limited Partnerships (SLPs), have to appoint a ‘Members’ Agent’. Corporate members can appoint a Lloyd’s Advisor. All Lloyd’s members agents qualify as Lloyd’s Advisors.
The Corporation of Lloyd’s carries out the functions of advancing and protecting the interests of Lloyd’s members in connection with their Lloyd’s business.