Zurich Insurance Group is set to introduce its inaugural Lloyd\u2019s of London syndicate within weeks as it pursues speciality insurer Beazley.<\/p>\n
Beazley is also a participant in the Lloyd\u2019s market.<\/p>\n
The move was first reported by the Financial Times (FT), which cited CEO Mario Greco as saying that the company is close to completing arrangements for the new syndicate, which would allow Zurich to utilise private capital for underwriting risks within the Lloyd\u2019s market.<\/p>\n
In an e-mailed statement to Life Insurance International, the insurer acknowledged the report as \u201cfactual\u201d but refused to comment further.<\/p>\n
The development comes as an alternative strategy should the insurer’s ongoing bid for Beazley fail.<\/p>\n
Recently, Zurich sweetened its buyout offer<\/a> for rival Beazley to $10.2bn (SFr8.06bn).<\/p>\n According to Greco, the bid was the company\u2019s fifth proposal to purchase Beazley, a group known for offering insurance against risks such as cyber incidents.<\/p>\n Discussions between Zurich and Lloyd\u2019s are reportedly in advanced stages, with a possible launch of the new entity as soon as 2 April.<\/p>\n When asked, Zurich did not clarify whether it will proceed with its syndicate if it manages to acquire Beazley, the news publication added.<\/p>\n According to a source, Zurich\u2019s planned syndicate is expected to target annual premium revenues running into several \u201chundreds of millions of pounds\u201d.<\/p>\n The move could provide an additional route for Zurich to develop its speciality lines business, especially as more private capital enters the Lloyd\u2019s marketplace.<\/p>\n Greco was quoted by the FT as saying: \u201cYou can do deals on the Lloyd\u2019s platform where you access private capital, which is different from capital offered by the reinsurance companies.\u201d<\/p>\n He noted that terms available through Lloyd\u2019s are \u201ccompetitive with the best conditions you can find outside\u201d the market.<\/p>\n Private investment is playing a larger role in Lloyd\u2019s, challenging traditional reinsurers such as Munich Re and Swiss Re, the news publication noted.<\/p>\n