New entity will separate regional business from Lloyd's
SVB Holdings is to establish a new insurance company to underwrite its regional business.
The new business is expected to be up and running by the end of March.
SVB group finance director Oliver Corbett said the insurer currently had £360m managed capacity in the international subscription market, but there was a further £60-£70m which sits in the regional markets.
He said: "The regional business doesn't benefit from Lloyd's and doesn't need to be involved in the market. We have a strategic objective to diversify SVB through this method of distribution."
The new entity, which is yet to have an official name, will sit alongside SVB's specialist Lloyd's service company.
Corbett said up to 90% of business handled by its regional service company Novae would be underwritten by the new company. The remainder will be underwritten by SVB's Lloyd's two syndicates.
"It is exclusively designed to write retail business for the regions - the small to mid ticket business," Corbett said.
This would include UK directors' and officers' cover, professional indemnity, medical malpractice and general liability, he said.
SVB made the announcement as it published its latest set of Lloyd's results.
SVB continues to pay off outstanding claims from the run-off of the 2002 year of account. Syndicate 1241, of which SVB owns 99.7% of the £168.9m capacity, ran at an 80.4% loss for the 2002 year.
Syndicate 1007, where SVB owns 55.4% of £150.8m capacity, maintained a 13.2% loss ratio in 2002.
Of the £103m set aside to pay off debts in July 2004, only £28m was unutilised, the company said. But SVB said in 2005 there has been a reduction in adverse developments of 48%, and added that the trend was expected to continue.
