![]() For those Bermuda reinsurers that have enjoyed the benefits of speed to market that are a characteristic of the Island, the present, slow entry into the Lloyd’s market is unlikely to hold too much appeal. And with Solvency II placing increasingly stringent requirements on the franchise, the formation of new, compliant syndicates has become a “real challenge”. "Rather than take a profit centre by profit centre approach, firms need to be indifferent as to where business is placed, so long as business placed best suits the firm's underwriting appetite."Ĭreating your own syndicate at Lloyd’s meanwhile has its own particular challenges, with licensing at Lloyd’s an “extremely timeconsuming” process, according to Watson. Together, they enable firms to “hit the ground running”, although he added that in an acquired business, in all likelihood, there would be a need to chang e the existing business model in order to bend it to firm’s emerging needs also as with buying any entity, there is a run-off exposure of past liabilities. When entering the Lloyd’s market, players have the choice of either building their own syndicate or acquiring an existing platform, with Watson indicating that in the case of an acquired syndicate, firms are able to take advantage of the access it affords to clients and an existing “operational structure”. Again Lloyd’s global network of licences means that a London presence provides Bermuda players with an expanded catchment of international business-in terms of both line and geography. Further adding to the appeal of a London presence is an ability to “capture business as and when appetites and attitudes shift”, said Stephen Hartwig, senior vice president and head of insurance at Canopius in Bermuda, with a “presence on both sides of the Atlantic” enabling firms to consider more business, diversify their risk and potentially arbitrage the market. And with diversification-by line and geography- having become increasingly prevalent as the industry has matured, it is hardly surprising that a Lloyd’s platform has proven itself to be an attractive proposition for Bermuda and global players. Such international reach enables firms to fulfil “a desire to be global”-something Watson said all insurers and reinsurers aspire to. As David Watson, president and chief executive officer of XL Re Europe indicated, over the years, Bermuda players have entered the London market in order to take advantage of “Lloyd’s as a global platform”, with syndicates able to leverage “the extent of Lloyd’s licences around the world”. ![]() The market provides potential entrants with direct access to business passing through London-business that doesn’t necessarily make its way to the Island’s shores-whilst presenting them with the opportunity to further diversify their coverage by tapping into the London and European markets. Despite the number of existing syndicates, the Lloyd’s platform continues to be an attractive proposition for Bermuda players. ![]()
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