Lloyd’s re-surgent

As it approaches its 350^th birthday, Lloyd’s of London, the venerable insurance market, seems more important than ever. An underwriting platform at Lloyd’s is a desired platform for many global insurers, as recent M&A deals show. For global access to markets, nothing can compete. For risk syndication, it’s the premier international destination. To insure large or complex risks, it provides the world’s greatest amalgamation of expertise. Meanwhile, the market is a resurgent force in global reinsurance.

Lloyd’s holds roughly 200 licences issued by countries around the world to underwrite reinsurance. Many, Lloyd’s says, are “embedded in local legal systems”. That means having a platform at Lloyd’s gives a global risk carrier the ability to underwrite reinsurance risk almost anywhere (Tanzania excluded). That licencing is a big attraction.

Lloyd’s global reinsurance premium income has more than double since 2015. Reinsurance income now accounts for slightly more than a third of the market’s aggregate gross written premium, which makes reinsurance the largest single class of business underwritten by syndicates in the market. Most of those mini carriers are owned, managed, and financed by major international insurance groups.

Overall, property catastrophe excess of loss reinsurance contributes most to Lloyd’s inwards reinsurance portfolio, and represents the largest line in the class. Other key lines are property facultative, marine treaty, and property risk excess.

Recent performance has been good, driven by relatively low levels of catastrophe losses and generally high market rates of premium. Reinsurance yielded a profit of nearly £1.7 billion in 2024 to the collective Lloyd’s market, and £2.046 billion in 2025, despite a serious hit to many global catastrophe accounts from the California wildfires at the beginning of the year. Lloyd’s accident-year combined ratio edged downwards by 0.7 points, to 88.8%, in 2025.

Figures from Lloyd’s report that syndicates there wrote gross reinsurance premiums of £20,053 million in 2025, compared to £18,729 million in 2024, during a period when property catastrophe reinsurance rates were declining, particularly for US-exposed business. That represents growth of 7.1%, compared to 4.2% for Lloyd’s aggregate top line change. Reinsurance contributed 33.7% of total premiums in 2024, but edged up to 34.7% last year.

Some of the growth in the reinsurance share of market premiums may be attributable to faster-declining rates in insurance lines, but some of it too is the result of more reinsurance risk underwritten at Lloyd’s. It’s an area of the wholesale insurance business where Lloyd’s has actively sought, from the centre, to increase its global importance.

Rachel Turk, Lloyd’s Chief of Market Performance, is cautiously bullish on reinsurance. In September 2025 she told a conference audience that “the Lloyd’s share of reinsurance has been pitifully small for a really long time.” She added: “It would be great if we could actually have a decent reinsurance line.”

That’s happening. In its 2025 annual report, Lloyd’s said: “Reinsurance enjoyed the strongest expansion [of any class], driven by new entrants and innovative structured solutions.” The latest new syndicates writing reinsurance include:

• EnvelopRisk syndicate 1925, launched in 2024 to write cyber reinsurance for the SoftBank-backed MGA Envelop Risk.
• Africa Specialty Risks syndicate 2454, also launched in 2024, to write parametric coverage and treaty reinsurance.
• Oak Re 2843, new in 2025 and backed by third-party capital providers to write across the classes, including reinsurance, which reportedly accounts for more than 96% of its book.

In some cases, new syndicates have been established specifically to underwrite a share of the outwards reinsurance programmes of their parent insurers, often with funding from third parties channelled through Lloyd’s transformer vehicle, London Bridge II. That’s the case with AIG’s new Talbot syndicate 2478, which is backed by investment fund Blackstone to reinsure parts of AIG’s global P&C insurance book. It had 2025 capacity of £567 million.

The same is true of the new syndicate 1984, launched last year in part to underwrite whole-account reinsurance of Convex Group (funded with group capital), and of Syndicate 1890, announced in December 2025 to write a share of Allianz Group’s outwards programme (funded with third-party capital). More self-reinsuring syndicates are in the works.

Alongside the new entrants’ additions to Lloyd’s reinsurance top line, many established players increased the size of their reinsurance books. Lancashire, for example, cited reinsurance growth arising from new property, casualty, energy, aviation, and marine business.

Analysis by publication The Insurer shows that Liberty 4472, QBE Casualty 2999, and Chaucer 1084 had the three largest reinsurance portfolios at Lloyd’s in 2025. Those portfolios decreased by 5.2%, increased by 21.7%, and decreased by 4.0% respectively.

Lloyd’s is a market of multiple, independently managed underwriting agencies, so almost no generalisations about strategy will to all its components. Some carriers there will seek expanded natural catastrophe exposure, for example, while others want less cat risk on their books. However, trends can always be spotted.

One is that historically, when reinsurance market conditions have begun to soften, Lloyd’s has, in general, pursued market share, often leveraging outwards reinsurance to make the bet work. However, this has been firmly discouraged in the current cycle from the central market authorities at Lloyd’s.

Despite Lloyd’s enthusiasm for reinsurance, Rachel Turk is advising caution. As the market softens, she has warned syndicates at Lloyd’s that: “rate declines to levels that undo all margin will not go unchallenged”, and said that her department will scrutinise business plans based on growth that’s not aligned with market realities. She fell short of instructing underwriters to shrink their top line if necessary to avoid assuming risks at insufficient prices, a strategy that many large reinsurer have chosen this year.

She has also expressed concern about the risks of chasing premium in casualty lines, where she believes current pricing doesn’t adequately reflect social inflation risk, and in cyber reinsurance, where “the anticipated growth in new buyers… just isn’t coming through, so the market continues to chase the same pool.”

Without a doubt, some in the Lloyd’s market will continue to seek to grow their reinsurance portfolios in the year ahead, even as market prices slide in the face of competition. Others will reduce their exposure. It’s not possible to predict what will happen overall, because the various strategies and risk appetites of the managers of the risk capacity that funds Lloyd’s syndicates is divergent.

Those managers are the managing agents, the businesses which run the syndicates at Lloyd’s, applying and deploying the capital of their owners, or of third parties.

Much of Lloyd’s total risk capacity of almost £60 billion is run by managing agents owned or controlled by international insurance groups (see Table 1). When considering whether or not to expand reinsurance underwritings at Lloyd’s, most will calculate their group’s total global exposure across all their platforms to, for example, Japanese earthquake or marine liability catastrophes (like the Baltimore Bridge catastrophe). Some, though, may leave Lloyd’s businesses to operate as distinct entities, without consideration of global catastrophe exposures. A few others are not part of an insurance group.

Of the total underwriting capacity for which data is publicly available (£55.8 billion of £58.2 billion), 69.8% is managed by exchange-listed insurance entities, and another 15.3% by private, mutual, or state-controlled insurers, which means global insurers control more than 85% of the capacity at Lloyd’s. Institutional investors including pension funds have about 12%, and the rest is mopped up by employee-owned agencies and privately held non-insurance investors.

No managing agency is permitted to control more than 7% of the market’s total capacity, but only the publicly listed insurer Beazley (soon to be acquired by Zurich Insurance under an agreed M&A deal) has more than 6%. The top ten together have 41.2%, and read like a who’s who of global insurers: QBE, Fairfax, Hiscox (current subject to acquisition speculation involving Canada’s growing Intact Financial), Tokio Marine, China Re, Mitsui Sumitomo, and AXIS Capital (Table 2).

Canopius is the only top-ten Lloyd’s manager that isn’t majority-owned by an insurer. However, Japan’s Samsung Fire & Marine is the largest minority owner, with 40%. When that ownership stake is considered, it takes capacity management at Lloyd’s by insurers to 87.0%, and reduces the institutional investors to just a shade over a tenth of the market.

The future importance of reinsurance at Lloyd’s will depend very much on the appetite of these global insurers to accept peak perils catastrophe risk, as well as reinsurance of specialty lines, excess coverage, and facultative risks. Their use of the market as a primary access point for such reinsurance business will be a matter of practicality, whether by gaining leverage against Lloyd’s international licences, or by taking advantage of its now-proven London Bridge II platform to build reinsurance sidecars funded by third parties. We anticipate more of both in the years ahead. All signs point to more reinsurance at Lloyd’s.