R&Q takes over former Equity syndicate

Run-off specialist Randall & Quilter has taken over the management of Syndicate 1208, previously managed by Equity Syndicate Management.

R&Q has reinsured to close Syndicate 1208’s open 2007 year into the 2012 year of its own Lloyd’s operation, Syndicate 3330. The estimated net insurance liabilities as at 31 December 2011 were roughly £23m.

Lloyd’s syndicates effectively ‘close’ at the end of each year of account, and any outstanding liabilities are reinsured into the syndicate’s new accounting year in a process called reinsurance to close (RITC). However, if there are difficulties, such as a large number of outstanding liabilities, the old year remains ‘open’.

Under the transaction, R&Q Managing Agency will receive customary annual fees and profit commissions as the new managing agent. The group’s insurance services division will also take over the claims management and accounting services from mid-2012 and will receive additional service fees.

Furthermore, R&Q Capital No.1, R&Q’s corporate member, has provided capital support to Syndicate 1208 through the provision of funds at Lloyd’s and the group has rights to 50% of any future syndicate profits.

“We are delighted to have completed the RITC of Syndicate 1208 into Syndicate 3330 and to have been able to provide capital support from our corporate member, which now has three syndicate participations,” R&Q chief executive Ken Randall said in a statement.

“The transaction further reinforces R&Q’s position as an active participant in the RITC market as manager, service provider and capital provider. We are also pleased to announce that, following the transaction, Henry Colthurst has joined the group from Equity Syndicate Management.”