LONDON–(BUSINESS WIRE)–A.M. Best has affirmed the Financial Strength Rating (FSR) of A (Excellent) and the Long-Term Issuer Credit Rating (Long-Term ICR) of “a+” of Lloyd’s Syndicate 3000 (Syndicate 3000) (United Kingdom). The outlook of these Credit Ratings (ratings) remains stable.
The ratings of Syndicate 3000 reflect the balance sheet strength of the Lloyd’s market, which A.M. Best categorises as very strong, as well as the market’s strong operating performance, favourable business profile and appropriate enterprise risk management. The Lloyd’s market rating is the floor for all syndicate ratings, reflecting the Lloyd’s chain of security and, in particular, the role of the Central Fund, which partially mutualises capital at the market level.
Markel Corporation (Markel) is the ultimate parent company of Lloyd’s Syndicate 3000’s managing agent, Markel Syndicate Management Limited, and of its corporate member, Markel Capital Limited. Syndicate 3000 is important to Markel as its main underwriting centre for marine, large U.S. and international property risks and specialty and financial lines written in the London market. For the 2018 year of account, Markel maintained the syndicate’s capacity at GBP 500 million.
The recent technical performance of the syndicate has been weaker than the overall Lloyd’s market, demonstrated by a five-year average combined ratio of 102% (2013-2017), compared with Lloyd’s market five-year average combined ratio of 96%. In 2017, catastrophe losses added 16 points to the syndicate’s combined ratio, which was in line with A.M. Best’s expectations given the size and frequency of catastrophe events during the year. A.M. Best expects the syndicate’s prospective performance to benefit from remedial portfolio actions, including the syndicate’s decision to cease underwriting open market property business written in London from the first quarter of 2018.
The business profile of all syndicates is inextricably linked to that of Lloyd’s, which has a strong position in the global general insurance and reinsurance markets. The collective size of the Lloyd’s market allows Syndicate 3000 to compete under the Lloyd’s brand with international groups. In 2017, Syndicate 3000 ranked amongst the 20 largest Lloyd’s syndicates by gross written premium.
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