Syndicate results 2021 #15 Inigo 1301 published Wednesday May 4th

The Lloyd’s syndicates have now published their results for 2021 and, in some cases, added detail and an outlook for 2022. Some have stuck to the bare bones. As last year, IMN is summarizing the results from all syndicates that have a marine interest, which have provided some information on the marine side.

  • CEO   R Watson
  • Syndicate Active underwriter        R Merrett

On June 10th 2020 Enstar Group announced that they were placing StarStone International operations, including StarStone Syndicate 1301, into an immediate and orderly run-off. For the 2020 and prior years of account, the Syndicate had focused on London Wholesale Market Business, European Retail Business and US Retail Business, through both the Syndicate and StarStone’s wholly owned service companies in Europe and the US.

The Syndicate offered a broad range of Property, Casualty and Specialty insurance products from large multinational through to small and middle-market clients around the world, with the Syndicate writing a diversified portfolio by territory and line of business.

The Syndicate’s operations were managed across two business units: Marine, Aviation & Transport and Specialty.

The Marine segment offered a range of Marine products including Hull and Machinery, Marine and Energy Liabilities, Cargo, War, Transport Liabilities, Offshore Energy and Specie & Fine Art. The Aviation segment included General Aviation. Both Marine and Aviation were primarily written from London, but some European retail business was also written through the Syndicate service company branch network.

On March 15th 2021 Inigo Ltd of One Creechurch Place completed the acquisition of StarStone Underwriting Limited (SUL), the Lloyd’s managing agency, and Syndicate 1301’s capacity for the 2021 year of account and subsequent years. The seller was Enstar Group Ltd. Following the completion, SUL was renamed Inigo Managing Agent Ltd (IMAL).

The Syndicate commenced writing a new portfolio of insurance and reinsurance risks for the 2021 year of account under new management through Inigo Corporate Member Limited (ICML).

Enstar have retained the liabilities of Syndicate 1301’s 2020 and prior years of account through SGL No 1 Ltd , a corporate member in the Enstar Group. Ultimately these years of account will be transferred through reinsurance to close to Syndicate 2008. This is expected to happen on January 1st 2023.

Enstar Managing Agency Ltd (EMAL) was approved in 2021 as Enstar’s dedicated Lloyd’s run-off managing agency. The management of the 2020 and each prior year of account for Syndicate 1301 were novated or otherwise transferred to EMAL on June 1st 2021.

The Syndicate is fully aligned by year of account.

The 2021 and subsequent years of account have no liability to the 2020 year of account and each prior year of account. Actual claims paid and claims reported were low on the 2021 year of account.

The result for the year includes all years of account combined.

KPI

$m 2021 2020 (Restated)
Gross written premium 428.0 185.4
Gross premiums earned 317.3 217.3
Net premiums earned 239.8 174.4
Profit/(Loss) for the financial year (31.7) (31.5)
Ratios    
Claims ratio 73.8% 71.4%
Commission ratio 21.8% 26.4%
Expense ratio 18.5% 22.2%
Combined ratio 114.1% 120.0%

Gross written premium was $428m (2020: $185.4m). $411.5m relates to the 2021 year of account, Inigo’s first year of underwriting insurance and reinsurance business. This exceeded the initial Syndicate Business Forecast (SBF) of $389.5m ultimate premium for 2021 year of account and was in line with a resubmitted SBF ultimate premium of $427.4m. Additional income was also written on behalf of the Inigo Directors and Officers and the Inigo Property consortia.

A prudent approach to risk retention resulted in significant use of reinsurance protection. As many contracts purchased cover both 2021 and 2022 years of account, this resulted in a significant level of ceded premium, which in turn led to lower levels of net written premium.

As the 2020 year of account was placed into run off in June 2020 there was a low amount of premium earning in the 2021 figures from this year of account, increasing the KPI ratios.

The Syndicate reported an investment return loss of $0.4m (2020: $4.1m gain) for the financial year. This comprises realised loss of $0.9m (2020: realised gain of $0.4m), unrealised loss of $0.6m (2020: unrealised gain of $2.3m) and investment income $1.1m (2020: $1.4m).

The Casualty segment offers a range of Casualty products including Directors and Officers, Marine and Energy, and General Liability.

M&E Liability and Ports: The team of three underwriters focusses on three main sub-segments: Marine Liability, Energy Liability and Ports. The account has predominantly higher excess layers. The team wrote approximately $12.4m in the 2021 underwriting year

Segmental Details

2021 $’000s GPW GPE GCI GOE Reins Bal Total
Direct MAT 6,338 14,758 11,720 (4,652) (995) 20,831
Total Direct 221,452 150,163 (107,824) (52,593) 1,941 (8,313)
Reinsurance 206,595 167,090 (92,751) (45,132) (54,726) (25,519)
Total 428,047 317,253 (200,575) (97,725) (52,785) (33,832)
2020 (Restated $’000s GPW GPE GCI GOE Reins Bal Total
Direct MAT 38,247 48,598 (27,362) (17,585) (4,251) (600)
Total 115,875 133,030 (113,889) (48,904) 12,707 (17,056)
Reinsurance 69,516 84,233 (81,550) (35,304) 16,414 (16,207)
Total 185,391 217,263 (195,439) (84,208) 29,121 (33,263)

The active underwriter received the following aggregate.

$’000s 2021 2020 (Restated)
Emoluments 381 254

https://assets.lloyds.com/media/fdb87e69-df59-45ba-8a7e-e14019042c27/SRA1301a.pdf