What is the meaning of a Subscription Market
More than one insurer can participate in any one risk
There are no restrictions on the combination of Lloyds/companies/Outside insurers
Issues that influence whether business comes into London:
Broker and Client Loyalty, Experience, Permissions
Issues that influence whether insurers can write 100% of any one risk:
Capacity, Branch office controls, aggregates, broker/client influence, licensing
Percentage of UK risks that make up the business written in Lloyds
12%
Lloyds permissions to trade internationally
Lloyds has licences that apply to the whole market
What is a Proprietary company
Owned by shareholders who buy shares and contribute to the share capital of the firm. The company profits belong to the shareholders.
What is a Mutual company
Owned by policy holders, policy holders are liable for any losses made by the company.
What is a Captive insurance company
Owned by a non-insurance parent company,
What are Mutual Indemnity Associations
Owned by policy holders, their members group together to essentially self-insure. (P&I Clubs for marine liability)
What are Lloyds Service Companies
Set up solely to write business on behalf of the syndicate; obtain capacity and authority from the syndicate rather than via shareholders.
Who is responsible for meeting the Lloyds Principles for doing business
Managing agents, the board of each managing agent
What is Aggregation
Insurers monitor the location of the risks they take on. Too many risks located in one place will lead to higher losses if an event happens, such as fire or earthquake; they protect this by accepting smaller shares in each risks and plotting the location
Term used to state an insurers capacity
Premium income limit
