At least four jobs are at risk following Charles Taylor Managing Agency’s (CTMA) decision to close its loss-making Syndicate 1884’s property book, Re-Insurance understands.
It is believed those facing the axe include lead property underwriter and industry veteran Stephen Woodward.
Sources told this publication that there will be job losses from Standard Syndicate 1884 which is set to close its property account after running at a loss for three years consecutively.
Four-to-five property underwriters are believed to be facing a redundancy process although the company has refused requests for comment.
Among those affected is thought to be industry veteran Stephen Woodward.
Woodward joined in January 2018 as head of property to develop the syndicate’s property portfolio, following a career that spans over 30 years and includes notable stints at Paris Re, Partner Re and Swiss Re.
The syndicate and the turnkey Managing agency is known to be under the watchful eye of Lloyd’s performance director Jon Hancock following consecutive losses since its formation in 2015.
Re-Insurance first revealed in June that Hancock was cracking down on under-performing syndicates, threatening them with closure if their results did not improve, following a meeting with market CEOs on 24 May.
After last year’s £2bn market loss, syndicates have come under pressure to either cut back or withdraw entirely from classes of business that cannot be returned to profitability.
In Monte Carlo earlier this week, Hancock confirmed a consequence of his approach could see Lloyd’s shrink its top line next year.
Serially under-performing syndicates have also been warned that they face being ordered to go into run-off if they cannot present a coherent plan of returning to profit. The Syndicate – which began trading in 2015 – has yet to make a profit. Its capital is provided by the Standard club, a UK-based P&I mutual, and is managed by CTMA on a turnkey basis.
However, CTMA is understood to be working with Lloyd’s to ameliorate its concerns and later this year former Capita executive Colin Grint joins to become CEO of the managing agency.
Late last month the Standard Syndicate said it was focusing on its “core competencies” of marine and energy.
According to its 2017 year of accounts, the Standard Syndicate reported a loss of £34.2mn and the property book ran at a net loss ratio of 162 percent with a net underwriting loss of £3.7mn in a heavy cat loss year.
In 2016, the property account ran at a net loss ratio of 105 percent and in 2015 it posted a net loss ratio of 117 percent.
In June, Re-Insurance revealed that international (non-US) property is one of the seven business classes placed under the Corporation’s microscope.
The seven classes – which were worth £6.4bn in GWP revenues to the market in 2017 – are: marine hull; cargo; power; yacht; international professional indemnity; international D&F property/binders; and overseas motor.
CTMA’s parent company, Charles Taylor plc, today reported a fall in H1 profits from £4.8mn to £0.2mn caused by exceptional costs relating to restructuring initiatives. Underlying - or “adjusted” – profits were up, said the company.
As part of its results statement today, Charles Taylor said: “The syndicate strengthened its underwriting team in H1 2018 with the objective of improving its underwriting performance, which has been below expectations in its early years of operation”.
It added: “However insurance market conditions continue to be difficult; as a result, Lloyd’s has been increasingly scrutinising the perfor- mance of all Lloyd’s syndicates, resulting in a more challenging operating environment for The Standard Syndicate”.