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Docusign Envelope ID: 26F458F7-8D82-4E50-8949-0309D504E775
Polo Managing Agency Limited
Lloyd’s Syndicate
Syndicate 1347
Annual Report and Accounts for the year ended
Docusign Envelope ID: 26F458F7-8D82-4E50-8949-0309D504E775
Registered office: Polo Managing Agency, registered in England & Wales Registration no.
03935227
www.polo.works
1
Contents
Directors and Administration
..........................................................................................................
2
Managing Agent’s Report
..............................................................................................................
3
Statement of Managing Agent’s Responsibilities
..........................................................................
6
Independent Auditor’s Report to the Member of Syndicate 1347
...................................................
7
Statement of profit or loss and other comprehensive income
.......................................................
11
Balance sheet
..............................................................................................................................
13
Statement of changes in member’s balances
..............................................................................
14
Statement of cash flows
..............................................................................................................
15
Notes to the financial statements
.................................................................................................
16
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03935227
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2
Directors and Administration
Managing Agent
Registered office
Grange Park,
Bishop's Cleeve,
Cheltenham, England,
GL52 8YQ
Registered Number
03935227
Directors
P D Andrews
M J Bishop (resigned 13 Mar 2025)
I J Bremner*
K D Curtis*
J A Hummerston (resigned 19 Feb 2025)
C E Layton (Appointed 03 Jan 2025)
S Minshall
G H J Nokes (appointed 13 Mar 2025)
R M Richardson-Bunbury
M Sebold-Bender*
P R Smith
Z Szalkai
P I Wooldridge
*Independent non-executive director
Company Secretary
L Robinson (appointed 6 Oct 2025)
P M Laws (resigned 15 Sep 2025)
Syndicate
Run-Off Manager
P D Close
Bankers
Barclays Bank
Independent Auditors
PKF Littlejohn LLP
Statement of actuarial opinion signing actuary
PKF Littlejohn LLP
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3
Managing Agent’s Report
The Directors of PMA, the Managing Agent, present their report for Syndicate 1347 ("the Syndicate") for the
year ended 31 December 2025.
The financial statements have been prepared in accordance with the Insurance Accounts Directive (Lloyd’s
Syndicate and Aggregate Accounts) Regulations 2008, United Kingdom Accounting Standards including FRS
102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” and FRS 103 “Insurance
Contracts” (United Kingdom Generally Accepted Accounting Practice), and the Lloyd’s Syndicate Accounts
Instructions V3.1 as modified by the Frequently Asked Questions V1.1 issued by Lloyd’s (the Syndicate
Accounts Instructions).
Results
The result for the year ended 31 December 2025 is a loss of £0.2m.
This is the final year of operation for the Syndicate.
Principal activities
The Syndicate voluntarily ceased underwriting with effect from 31 December 2023, accordingly the Syndicate
is now in run-off and no longer considered a Going Concern. Therefore, The Report and Accounts have been
prepared on a basis other than Going Concern.
In June 2024 all technical balances were commuted back to the cedant with payment being made on 27th June
2024 to Wakam SA (“Wakam”). As a result, during 2025 there have been no insurance related transactions.
At the end of 2025 the Syndicate Reinsured to Close (“RITC”) the 2023 underwriting year of account into
Syndicate 1254, effective 1 January 2026. Given there are no insurance liabilities being transferred there is no
insurance risk being transferred. The Syndicate has recognised an RITC administration fee of £250k to cover
the administrative costs associated with running off the Syndicate in addition to a £1 RITC premium.
Management of the Syndicate
Polo Managing Agency Limited (“PMA”) is the Managing Agency for the Syndicate.
The Managing Agent is a wholly owned subsidiary of Marco Capital Holdings (UK) Limited.
Review of the financial performance
The table below summarises the performance of the Syndicate for the twelve months to 31 December 2025.
Key performance indicators
2025
2024
£m
£m
Gross premiums written
-
0.7
Net premiums earned
-
0.7
Net claims incurred
-
(0.7)
Net operating expenses
(0.2)
0.2
(Loss) for the financial year
(0.2)
(0.2)
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Principal risks and uncertainties
The Managing Agent has a Risk Management Function for the Syndicate with clear terms of reference from the
Board of Directors and its committees, including the Audit and Risk committees. The Board approves the risk
management policies and meets regularly to approve commercial, regulatory and organisational requirements
of such policies. The Board reviews and approves its risk appetite annually.
The Risk Management Function has implemented a Board approved Risk Management Framework to enable
the ongoing identification, assessment and management (mitigation, monitoring and reporting) of risks.
The principal risks and uncertainties facing the Syndicate are set out below. Additional information regarding
how the Syndicate manages risk, including capital management, is disclosed in Note 4 to these financial
statements.
Market risk
The key aspect of market risk is that the Syndicate incurs losses on foreign exchange movements as a result
of mismatches between the currencies in which assets and liabilities are denominated. Currency matching is
reviewed by Management quarterly. Where there is a significant mismatch, the Managing Agent seeks to
mitigate the risk through buying or selling currency, where this is appropriate.
Liquidity risk
Liquidity risk is the risk that the Syndicate will encounter difficulty in meeting obligations due to a short-term
shortfall in available funds. A number of processes are followed by the Managing Agent to mitigate against the
risk of the Syndicate being unable to settle its obligations as they fall due.
Operational Risk
This is the risk that errors caused by people, processes or systems lead to losses to the Syndicate. Risks include
those from information security (including cyber) and technology related activities, legal and regulatory, financial
reporting, and financial crime as well as those from operations, outsourcing and change. The Managing Agent
seeks to manage this risk through its governance structure and internal control framework as well as business
processes (including business continuity and resilience plans).
Regulatory Risk
The Managing Agent is required to comply with the requirements of the Prudential Regulation Authority (“PRA”)
and Financial Conduct Authority (“FCA”) and Lloyd’s. Lloyd’s requirements include those imposed on the Lloyd’s
market by overseas regulators, particularly in respect of US situs business. Regulatory risk is the risk of loss
owing to a breach of regulatory requirements or failure to respond to regulatory change.
The Managing Agent has a Compliance Function that monitors regulatory developments and assesses the
impact on the Managing Agent’s policies. The compliance function reports regularly to the Board which has
ultimate responsibility for ensuring compliance with applicable laws and regulations.
Future Developments
The Syndicate voluntarily ceased underwriting with effect from 31 December 2023. In June 2024 all technical
balances were commuted with a payment being made on 27
th
June 2024 to Wakam. As a result, no underwriting
technical balances remain on the balance sheet of Syndicate 1347 and the Syndicate has no future premium.
The Syndicate has been reinsured to close at the end of 2025.
Following the commutation noted above, it was also agreed that all future expenses for the Syndicate will be
paid, and not recharged, by the Wakam Group, to which the Syndicate is wholly aligned via the Wakam
Corporate Member.
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This will be the Syndicate’s final set of financial statements.
Post Balance sheet events
PMA successfully agreed and completed the RITC agreement of Syndicate 1347 into Syndicate 1254, on 16
February 2026.
Environmental matters
The Managing Agent does not believe this Syndicate has a large adverse impact upon the environment
Underwriting has ceased and no investment portfolio is held. As a result, the agent does not manage this
Syndicate by reference to any environmental key performance indicators.
Directors
Details of the Directors of the Managing Agent who served during the year and up to the date of signing of the
Syndicate Annual Report and Accounts are provided on page 2 in the Directors and Administration section.
Disclosure of information to the auditors
The Directors of the Managing Agent at the time the report is approved confirm that:
•
So far as each of them is aware, there is no relevant audit information, being information needed by
the Syndicate’s auditor in connection with the auditor’s report, of which the auditor is unaware; and
•
Having made enquiries of fellow Directors of the Managing Agency and the Syndicate’s auditor, each
director has taken all the steps that he or she ought to have taken as a director to become aware of
any relevant audit information and to establish that the Syndicate’s auditor is aware of that information.
Auditors
Pursuant to Section 14 (2) of Schedule 1 of the Insurance Accounts Directive (Lloyd’s Syndicate and Aggregate
Accounts) Regulations 2008, PKF Littlejohn LLP will continue in office. Following the completion of the
reinsurance to close and closure of Syndicate 1347, PLF Littlejohn LLP will resign as the Syndicate’s auditor.
On behalf of the Board
G H J Nokes
Director
17 February 2026
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Statement of Managing Agent’s Responsibilities
The Managing Agent is responsible for preparing the Syndicate annual report and accounts in accordance with
applicable laws and regulations.
The Insurance Accounts Directive (Lloyd’s Syndicate and Aggregate Accounts) Regulations 2008 require the
Managing Agent to prepare Syndicate annual report and accounts at 31 December each year in accordance
with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and
applicable law). The Syndicate annual reports and accounts are required by law to give a true and fair view of
the state of affairs of the Syndicate as at that date and of its profit or loss for that year.
In preparing the Syndicate annual report and accounts, the Managing Agent is required to
•
Select suitable accounting policies which are applied consistently;
•
Make judgements and estimates that are reasonable and prudent;
•
State whether applicable UK accounting standards have been followed, subject to any material
departures disclosed and explained in the notes to the Syndicate annual accounts;
•
Prepare the Syndicate annual report and accounts on the basis that the Syndicate will continue to write
future business unless it is inappropriate to presume that the Syndicate will do so; and
•
Prepare and review of the iXBRL tagging that has been applied to the Syndicate Accounts in
accordance with the instructions issued by Lloyd’s, including designing, implementing and maintaining
systems, processes and internal controls to result in tagging that is free from material non-compliance
with the instructions issued by Lloyd’s, whether due to fraud or error.
The Managing Agent is responsible for keeping proper accounting records which disclose with reasonable
accuracy at any time the financial position of the Syndicate and enable it to ensure that the Syndicate annual
report and accounts comply with the Insurance Accounts Directive (Lloyd’s Syndicate and Aggregate Accounts)
Regulations 2008. It is also responsible for safeguarding the assets of the Syndicate and hence for taking
reasonable steps for prevention and detection of fraud and other irregularities.
The Managing Agent is responsible for the maintenance and integrity of the corporate and financial information
included on the business’ website. Legislation in the United Kingdom governing the preparation and
dissemination of annual accounts may differ from legislation in other jurisdictions.
We confirm that to the best of our knowledge the Syndicate accounts, including the iXBRL tagging applied to
these accounts, comply with the requirements of the Lloyd’s Syndicate Accounts Instructions V3.1 as modified
by the Frequently Asked Questions V1.1 issued by Lloyd’s.
On behalf of the Board
G H J Nokes
Director
17 February 2026
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7
Independent Auditor’s Report to the Member of Syndicate 1347
Opinion
We have audited the Syndicate Annual Accounts of Syndicate 1347 (the ‘Syndicate’) for the year ended 31
December 2025 which comprise the Statement of profit or loss and other comprehensive income, the Balance
sheet, the Statement of changes in member’s balances, the Statement of cash flows and notes to the financial
statements, including significant accounting policies. The financial reporting framework that has been applied
in their preparation is applicable law and United Kingdom Accounting Standards, including FRS 102 The
Financial Reporting Standard applicable in the UK and Republic of Ireland and FRS 103 "Insurance Contracts"
(United Kingdom Generally Accepted Accounting Practice), and the Lloyd's Syndicate Accounts Instructions
version 3.1 as modified by the Frequently Asked Questions version 1.1 issued by Lloyd's (the Syndicate
Accounts Instructions).
In our opinion, the Syndicate Annual Accounts:
•
give a true and fair view of the state of the Syndicate’s affairs as at 31 December 2025 and of its loss
for the year then ended;
•
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting
Practice; and
•
have been prepared in accordance with the requirements of the Insurance Accounts Directive (Lloyd’s
Syndicate and Aggregate Accounts) Regulations 2008 and the requirements within Lloyd’s Syndicate
Accounts Instructions Version 3.1 as modified by the Frequently Asked Questions Version 1.0 issued
by Lloyd’s (the “Lloyd’s Syndicate Accounts Instructions”).
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)), The Insurance
Accounts Directive (Lloyd’s Syndicate and Aggregate Accounts) Regulations 2008, the Lloyd’s Syndicate
Accounts Instructions and other applicable law. Our responsibilities under those standards are further described
in the Auditor’s responsibilities for the audit of the Syndicate Annual Accounts section of our report. We are
independent of the Syndicate in accordance with the ethical requirements that are relevant to our audit of the
Syndicate Annual Accounts in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other
ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have
obtained is sufficient and appropriate to provide a basis for our opinion.
Other Matter
This report may be included within a document to which iXBRL tagging has been applied. This auditor’s report
provides no assurance over whether the iXBRL tagging has been applied in accordance with the Lloyd’s
Syndicate Accounts Instructions.
Emphasis of matter – financial statements prepared on a basis other than going concern
We draw attention to Note 1 to the Syndicate Annual Accounts which explains that the syndicate has voluntarily
ceased underwriting and therefore the Managing Agent does not consider it to be appropriate to adopt the going
concern basis of accounting in preparing the Syndicate Annual Accounts. Accordingly, the Syndicate Annual
Accounts have been prepared on a basis other than going concern as described in Note 1.
Our opinion is not modified in this respect of this matter.
Other information
The other information comprises the information included in the Syndicate Annual Report and Accounts, other
than the Syndicate Annual Accounts and our auditor’s report thereon.
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8
The managing agent is responsible for the other information contained within the Syndicate Annual Report and
Accounts. Our opinion on the Syndicate Annual Accounts does not cover the other information and, except to
the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.
Our responsibility is to read the other information and, in doing so, consider whether the other information is
materially inconsistent with the Syndicate Annual Accounts or our knowledge obtained in the course of the audit,
or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material
misstatements, we are required to determine whether this gives rise to a material misstatement in the Syndicate
Annual Accounts themselves. If, based on the work we have performed, we conclude that there is a material
misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the Insurance Accounts Directive (Lloyd’s Syndicate and
Aggregate Accounts) Regulations 2008
In our opinion, based on the work undertaken in the course of the audit:
•
the information given in the managing agent’s report for the financial year for which the Syndicate
Annual Accounts are prepared is consistent with the Syndicate Annual Accounts; and
•
the managing agent’s report has been prepared in accordance with applicable legal requirements.
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the Syndicate and its environment obtained in the course of
the audit, we have not identified material misstatements in the managing agent’s report.
We have nothing to report in respect of the following matters in relation to which the Insurance Accounts
Directive (Lloyd’s Syndicate and Aggregate Accounts) Regulations 2008 requires us to report to you if, in our
opinion:
•
adequate accounting records have not been kept on behalf of the Syndicate; or
•
the Syndicate Annual Accounts are not in agreement with the accounting records and returns; or
•
certain disclosures of managing agent emoluments and other benefits specified by law are not made;
or
•
we have not received all the information and explanations we require for our audit.
Responsibilities of the managing agent
As explained more fully in the statement of managing agent’s responsibilities, the managing agent is responsible
for the preparation of the Syndicate Annual Accounts and for being satisfied that they give a true and fair view
and for such internal control as the managing agent determines is necessary to enable the preparation of
Syndicate Annual Accounts that are free from material misstatement, whether due to fraud or error.
In preparing the Syndicate Annual Accounts, the managing agent is responsible for assessing the Syndicate’s
ability to continue to write new business, disclosing, as applicable, matters related to its ability to continue to
operate and using the going concern basis of accounting, unless the managing agent intends to cease to
operate the Syndicate or has no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the Syndicate Annual Accounts
Our objectives are to obtain reasonable assurance about whether the Syndicate Annual Accounts as a whole
are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes
our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted
in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise
from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be
expected to influence the economic decisions of users taken on the basis of these Syndicate Annual Accounts.
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Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures
in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities,
including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is
detailed below:
•
We obtained an understanding of the Syndicate and the insurance sector in which it operates to identify
laws and regulations that could reasonably be expected to have a direct effect on the Syndicate Annual
Accounts such as The Insurance Accounts Directive (Lloyd’s Syndicate and Aggregate Accounts)
Regulations 2008 and the Lloyd’s Syndicate Accounts Instructions. We obtained our understanding in this
regard through discussions with management, industry research and the application of our cumulative audit
knowledge and experience of the insurance sector.
•
We determined the principal laws and regulations relevant to the Syndicate in this regard to be those arising
from the Financial Conduct Authority (FCA), the Prudential Regulation Authority (PRA), Lloyd’s of London
and the Insurance Accounts Directive (Lloyd’s Syndicates and Aggregate Accounts) Regulations 2008, and
the financial reporting framework (UK GAAP).
•
The Syndicate operates in the insurance industry which is a highly regulated environment. As such the
Senior Statutory Auditor considered the experience and expertise of the engagement team to ensure that
the team has the appropriate competence and capabilities to perform the audit.
•
We designed our audit procedures to ensure the audit team considered whether there were any indications
of non-compliance by the Syndicate with those laws and regulations. These procedures included, but were
not limited to:
o
agreement of the Syndicate Annual Accounts disclosures to underlying supporting documentation;
o
enquiries of management and review of minutes of Board, committee and management meetings
throughout the period;
o
understanding the Syndicate’s policies and procedures in monitoring compliance with laws and
regulations;
o
inspection of correspondence with Lloyd’s of London, the PRA and FCA; and
o
reviewing compliance reports and internal audit reports relating to the Syndicate.
•
We also identified possible risks of material misstatement of the Syndicate Annual Accounts due to fraud;
in particular:
o
We have rebutted the fraud risk over revenue recognition given the Syndicate is no longer writing
or earning material revenue streams since it is in run-off, and consider there is no area of judgement
or subjectivity with respect to revenue..
o
As in all of our audits, we addressed the risk of fraud arising from management override of controls
by performing audit procedures which included, but were not limited to, the testing of journals and
evaluating the business rationale of any significant transactions that were unusual or outside the
normal course of business.
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including
those leading to a material misstatement in the Syndicate Annual Accounts or non-compliance with laws and
regulations. This risk increases the more that compliance with a law or regulation is removed from the events
and transactions reflected in the Syndicate Annual Accounts, as we will be less likely to become aware of
instances of non-compliance. This risk is also greater regarding irregularities occurring due to fraud rather than
error, as fraud involves intentional concealment, forgery, conclusion, omission or misrepresentation.
A further description of our responsibilities for the audit of the Syndicate Annual Accounts is located on the
Financial Reporting Council’s website at:
www.frc.org.uk/auditorsresponsibilities
. This description forms part of
our auditor’s report.
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Use of our report
This report is made solely to the Syndicate’s members, as a body, in accordance with Part 2 of the Insurance
Accounts Directive (Lloyd’s Syndicate and Aggregate Accounts) Regulations 2008.
Our audit work has been
undertaken so that we might state to the Syndicate’s members those matters we are required to state to them
in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or
assume responsibility to anyone, other than the Syndicate and the Syndicate's members as a body, for our
audit work, for this report, or for the opinions we have formed.
Cheryl Mason
(Senior Statutory Auditor)
15 Westferry Circus
For and on behalf of PKF Littlejohn LLP
Canary Wharf
Statutory Auditor
London E14 4HD
17 February 2026
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11
Statement of profit or loss and other comprehensive income
Technical account – General business
For the year ended 31 December 2025
Note
2025
£000
2024
£000
Gross premiums written
5
Premiums written, net of reinsurance
Earned premiums, net of reinsurance
Allocated investment return transferred from the non-technical
account
9
Claims paid
12
Gross amount
(12,977 )
Net claims paid
(12,977 )
Change in the provision for claims
12
Gross amount
Net change in provisions for claims
Claims incurred, net of reinsurance
(714 )
Net operating expenses
6
(243 )
(185 )
Balance on the technical account – general business
(243 )
(169 )
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12
Statement of profit or loss and other comprehensive income (cont.)
Non-technical account – General business
For the year ended 31 December 2025
Note
2025
2024
£000
£000
Balance on the technical account – general business
(243 )
(169 )
Investment income
9
Total investment return
Allocated investment return transferred to the general business
technical account
(19 )
Loss on foreign exchange
(40 )
Loss for the financial year
(243 )
(209 )
Other comprehensive income
Total comprehensive loss for the year
(243 )
(209 )
The accompanying notes from pages 16 to 25 form an integral part of these financial statements.
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13
Balance sheet
As at 31 December 2025
Note
2025
2024
£000
£000
ASSETS
Other debtors
10
Debtors
Cash at bank and in hand
Other assets
Total assets
LIABILITIES
Member’s balances
(122 )
Total capital and reserves
(122 )
Other creditors including taxation and social security
11
Creditors
Total liabilities
Total liabilities, capital and reserves
The Syndicate financial statements on pages 11 to 25 were approved by the board of Directors of Polo Managing
Agency Limited on 16 February 2026 and were signed on its behalf by:
G H J Nokes
Director
17 February 2026
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14
Statement of changes in member’s balances
For the year ended 31 December 2025
2025
2024
£000
£000
Members’ balances brought forward at 1 January
Total recognised (losses)/gains for the year
(243 )
(209 )
Members’ balances at 31 December
(122 )
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15
Statement of cash flows
For the year ended 31 December 2025
Note
2025
2024
£000
£000
Cash flows from operating activities
Loss for the financial year
(243 )
(209 )
Adjustments:
(Decrease) in gross technical provisions
(12,423 )
(Increase) in debtors
(41 )
Increase in creditors
Investment return
(19 )
Other
(334 )
Net cash flows from operating activities
(34 )
(2,587 )
Cash flows from investing activities
Investment income received
Net cash flows from investing activities
Net cash flows from financing activities
Net (decrease) in cash and cash equivalents
(34 )
(2,568 )
Cash and cash equivalents at the beginning of the year
Cash and cash equivalents at the end of the year
13
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16
Notes to the financial statements – (Forming part of the financial
statements)
1. Basis of preparation
Syndicate
1347 (‘The Syndicate’) comprises a member of the Society of Lloyd's that underwrites insurance
business in the London Market. The address of the Syndicate’s managing agent is 'Grange Park', Bishop's
Cleeve, Cheltenham, England, GL52 8YQ.
The financial statements have been prepared in accordance with the Insurance Accounts Directive (Lloyd’s
Syndicate and Aggregate Accounts) Regulations 2008, United Kingdom Accounting Standards including FRS
102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” and FRS 103 “Insurance
Contracts” (United Kingdom Generally Accepted Accounting Practice), and the Lloyd’s Syndicate Accounts
Instructions V3.1 as modified by the Frequently Asked Questions Version V1.1 issued by Lloyd’s (the Syndicate
Accounts Instructions).
The financial statements have been prepared on the historical cost basis. The future cost of concluding the
Syndicate’s business was assessed with reference to the requirement for a run off provision. A run off provision
was not deemed necessary as all costs are being borne by Big Wakam.
The financial statements are presented in pounds sterling (“GBP”), which is also the Syndicate’s functional
currency.
All amounts have been rounded to the nearest thousand, unless otherwise indicated.
Further detail on the Reinsurance to Close is detailed within the accounting policies note K.
Going concern
The Syndicate voluntarily ceased underwriting with effect from 31 December 2023 and all technical balances
were commuted on 27
th
June 2024 with Wakam. As a result, no underwriting technical balances remain on the
balance sheet and the Syndicate has no future premium. These financial statements are prepared on a basis
other than Going Concern.
No further adjustments are necessary to the amounts at which the net assets are included in these financial
statements. FRS 102 and 103 have been consistently applied. There have been no material changes in
accounting policies or values necessary to address the non-going concern status of the Syndicate.
2.
Use of judgements and estimates
The Syndicate has made no estimates of judgements in preparing these financial statements due to their being
no insurance liabilities at the balance sheet date.
3. Significant accounting policies
The following significant accounting policies have been applied consistently in dealing with items which are
considered material in relation to the Syndicate’s financial statements.
A. Premiums written
Gross written premiums are stated gross of brokerage payable and exclude taxes and duties levied on them.
Premiums written comprise adjustments to premiums on contracts incepted in 2023, no new business was
written after 2023.
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B. Acquisition costs
Acquisition costs which represent commission and other related expenses are deferred over the period in which
the related premiums are earned, unless cedants explicitly report the Syndicate's share of deferred acquisition
costs in respect of the underlying policies.
C. Investment return
Investment return comprises bank interest received.
D.
Cash and cash equivalents
Cash and cash equivalents comprise cash balances and call deposits with maturities of three months or less
from the acquisition date that are subject to an insignificant risk of changes in fair value and are used by the
Syndicate in the management of its short-term commitments.
Cash and cash equivalents are carried at amortised cost in the statement of financial position.
E. Taxation
Under Schedule 19 of the Finance Act 1993 managing agents are not required to deduct basic rate income tax
from trading income. In addition, all UK basic rate income tax deducted from Syndicate investment income is
recoverable by managing agents and consequently the distribution made to members or their members’ agents
is gross of tax. Capital appreciation falls within trading income and is also distributed gross of tax.
No provision has been made for any United States Federal Income Tax payable on underwriting results or
investment earnings. Any payments on account made by the Syndicate during the year have been included in
the balance sheet under the heading ‘other debtors’.
No provision has been made for any other overseas tax payable by members on underwriting results.
F. Pension costs
No pension costs are directly borne by the Syndicate.
Polo Managing Agency Limited operates a defined contribution scheme. No explicit charge is made for pension
contributions relating to Managing Agent staff who act on behalf of the Syndicate within the Managing Agents
fee.
G. Operating expenses
Where expenses are incurred by the Managing Agent for the administration of the Syndicate, these expenses
are apportioned appropriately based on type of expense and allocated to the year of account for which they are
incurred.
H. Debtors and creditors
Other debtors principally consist of amounts due from Big Wakam and a refund from Lloyd’s. Both are carried
at amortised cost less any impairment losses.
I.
Classification of insurance and reinsurance contracts
Insurance and reinsurance contracts are classified as insurance contracts where they transfer significant
insurance risk. If a contract does not transfer significant insurance risk it is classified as a financial instrument.
J. Commutation Policy
The accounting policy for commutations within the Syndicate is the elimination of the existing premium
receivable and claims incurred due from and to Big Wakam respectively. The commutation resulted in a
payment of £2.2m to Big Wakam.
No gain or loss was made on the commutation as the fair value of the claims incurred was equal to the premium
receivable.
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03935227
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K. Reinsurance To Close
A reinsurance to close is a contract of insurance which, in return for a premium paid by the closing year of
account, transfers, normally to the following year of account, all known and unknown liabilities arising out of
transactions connected with insurance business underwritten by the closing year of account. However, it should
be noted that a reinsurance contract does not extinguish the primary liability of the original underwriter. Each
year of account is expected to RITC after 36 months in the normal course of Lloyd's business.
The 2023 year of account of the Syndicate has closed and all assets and liabilities transferred to the 2026 year
of account of Syndicate 1254 by reinsurance to close.
4.
Risk and capital management
Introduction and overview
This note presents information about the nature and extent of insurance and financial risks to which the
Syndicate is exposed, the Managing Agent’s objectives, policies and processes for measuring and managing
insurance and financial risks, and for managing the Syndicate’s capital.
Risk management framework
The Syndicate’s activities expose it to a variety of financial and non-financial risks. In order to achieve its
business plan and objectives, the Syndicate recognises that it is necessary to take risk and expects to be
rewarded for doing so. The Syndicate is also exposed to several unrewarded risks as a function of its operating
model, such as operational risk. The Managing Agent is responsible for understanding and managing the
Syndicate’s exposure to such risks and does this through the deployment of its enterprise risk management
(“ERM”) framework.
The Board of Directors of the Managing Agent has overall responsibility for the establishment and oversight of
the Syndicate’s risk management framework. The Board has established a Risk Committee to oversee the
operation of the Syndicate’s risk management framework and to review and monitor the management of the
risks to which the Syndicate is exposed. The Managing Agent's risk management framework includes processes
such as the annual review and approval of Syndicate risk appetites for the Syndicate as a part of the Syndicate's
Own Risk and Solvency Assessment ("ORSA") and capital setting process, risk and control assessment, regular
risk appetite monitoring, risk incident root cause analysis, emerging risk horizon scanning and risk management
reporting.
Critical to the risk management of the Syndicate is ensuring sufficient capital is in place to meet the solvency
needs of the Syndicate.
A. Financial risk
The focus of financial risk management for the Syndicate is ensuring that the proceeds from its financial assets
are sufficient to fund the obligations arising from its insurance contracts.
a. Credit risk
The key aspect of credit risk is reinsurance counterparty risk which is the risk of default by one or more of the
Syndicate’s reinsurers and intermediaries. The Syndicate has no reinsurance contracts as premium is ceded
net of inuring reinsurance. Therefore, the main source of credit risk for this syndicate is losses arising from
inwards premium debtors and bank counterparty risk.
i.
Management of credit risk
The Syndicate limits the amount of cash and cash equivalents that can be deposited with a single counterparty.
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ii.
Exposure to credit risk
The following table shows credit risk exposure of the Syndicate’s financial assets as at the balance sheet date.
As at 31 December 2025
AAA
AA
A
BBB
Other
Not rated
Total
£000
£000
£000
£000
£000
£000
£000
Cash at bank and in hand
Total
As at 31 December 2024
AAA
AA
A
BBB
Other
Not rated
Total
£000
£000
£000
£000
£000
£000
£000
Cash at bank and in hand
Total
iii.
Financial
assets that are past due or impaired
The Syndicate has no financial assets that are past due nor impaired at the reporting date.
As at 31 December 2025
Neither past
due nor
impaired
assets
Past due
but not
impaired
assets
Gross
value of
impaired
assets
Impairment
allowance
Total
£000
£000
£000
£000
£000
Cash at bank and in hand
-
Total
-
As at 31 December 2024
Neither past
due nor
impaired
assets
Past due
but not
impaired
assets
Gross
value of
impaired
assets
Impairment
allowance
Total
£000
£000
£000
£000
£000
Cash at bank and in hand
-
Total
-
b. Liquidity risk
Liquidity risk is the risk of failure to ensure that sufficient financial resources are available at all times to meet
payment obligations, with financing only being possible at an additional cost.
The nature of the Syndicate’s exposures to liquidity risk and its objectives, policies and processes for managing
liquidity risk have not changed significantly from the prior year.
i.
Management of liquidity risk
To mitigate liquidity risk, the agency monitors cash flow projections and maintains cash levels consistent with
the needs of the Syndicate, providing commentary into the SMC.
iv.
Maturity analysis of syndicate liabilities
The Syndicate’s insurance contracts were commuted on the 27
th
June 2024 hence there are no insurance
liabilities for 2025. For insurance and reinsurance contracts, the contractual maturity is the estimated date when
the gross undiscounted contractually required cash flows will occur.
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c. Market risk
Market risk is the risk that the fair value or future cash flows of a financial instrument or insurance contract will
fluctuate because of changes in market prices. Market risk comprises three types of risk: interest rate risk,
currency risk and other price risk.
The objective of market risk management is to manage and control market risk exposures within acceptable
parameters, while optimising the return on risk. The nature of the Syndicate exposures to market risk and its
objectives, policies and processes for managing market risk have not changed significantly from the prior year.
The Syndicate is not exposed to market risk as it does not hold any invested assets.
i.
Management of market risks
For each of the major components of market risk the Syndicate has policies and procedures in place which
detail how each risk should be managed and monitored. The management of each of these major components
of major risk and the exposure of the Syndicate at the reporting date to each major risk are addressed below.
ii.
Interest rate risk
The Syndicate’s main exposure to fluctuation in interest rates would be its effect on the valuation of funds
invested in bonds and equities. The Syndicate does not hold any financial investments, hence there is no
exposure to interest rate risk to the Syndicate.
iii. Currency risk
The Syndicate writes business primarily in Sterling, and Euro, and is therefore exposed to currency risk arising
from fluctuations in these exchange rates.
The table below summarises the carrying value of the Syndicate’s assets and liabilities, at the reporting date:
Year 2025
GBP
Euro
Total
£000
£000
£000
Debtors
Other assets
Total assets
Creditors
(250 )
(250 )
Total liabilities
(250 )
(250 )
Total Capital and reserves
(1 )
Year 2024
GBP
Euro
Total
£000
£000
£000
Debtors
Other assets
Total assets
Total liabilities
Total Capital and reserves
(26 )
(95 )
(121 )
Docusign Envelope ID: 26F458F7-8D82-4E50-8949-0309D504E775
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B. Capital management
i.
Capital framework at Lloyd’s
The Society of Lloyd’s (Lloyd’s) is a regulated undertaking and subject to the supervision of the PRA under the
Financial Services and Markets Act 2000 and in accordance with Solvency II requirements.
Within this supervisory framework, Lloyd’s applies capital requirements at member level and centrally to ensure
that Lloyd’s would comply with the Solvency II requirements, and beyond that to meet its own financial strength,
licence and ratings objectives.
Although, as described below, Lloyd’s capital setting processes use a capital requirement set at syndicate level
as a starting point, the requirement to meet Solvency II and Lloyd’s capital requirements apply at overall and
member level only respectively, not at syndicate level. Accordingly, the capital requirement in respect of
Syndicate 1347 is not disclosed in these financial statements.
ii.
Lloyd’s capital setting process
In order to meet Lloyd’s requirements, each syndicate is required to calculate its Solvency Capital Requirement
(SCR) for the prospective underwriting year. This amount must be sufficient to cover a 1 in 200-year loss,
reflecting uncertainty in the ultimate run-off of underwriting liabilities (SCR ‘to ultimate’). The Syndicate must
also calculate its SCR at the same confidence level but reflecting uncertainty over a one-year time horizon (one
year SCR) for Lloyd’s to use in meeting Solvency II requirements. The SCRs of each syndicate are subject to
review by Lloyd’s and approval by the Lloyd’s Capital and Planning Group.
A syndicate may be comprised of one or more underwriting members of Lloyd’s. Each member is liable for its
own share of underwriting liabilities on the Syndicates on which it is participating but not other members’ shares.
Accordingly, the capital requirements that Lloyd’s sets for each member operates on a similar basis.
Each member’s SCR shall thus be determined by the sum of the member’s share of the Syndicate SCR ‘to
ultimate’. Where a member participates on more than one syndicate, a credit for diversification is provided to
reflect the spread of risk, but consistent with determining an SCR which reflects the capital requirement to cover
a 1 in 200 loss ‘to ultimate’ for that member. Over and above this, Lloyd’s applies a capital uplift to the member’s
capital requirement, known as the Economic Capital Assessment (ECA). The purpose of this uplift, which is a
Lloyd’s not a Solvency II requirement, is to meet Lloyd’s financial strength, licence and ratings objectives. The
capital uplift applied for 2025 was 35% (2024: 35%) of the member’s SCR ‘to ultimate’.
iii.
Provision of capital by members
Each member may provide capital to meet its ECA either by assets held in trust by Lloyd’s specifically for that
member (FAL), assets held and managed within a syndicate (FIS), or as the member’s share of the members’
balances on each syndicate on which it participates.
Accordingly, all of the assets less liabilities of the Syndicate, as represented in the members’ balances reported
on the balance sheet on page 13, represent resources available to meet members’ and Lloyd’s capital
requirements.
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5.
Analysis of underwriting result
All premiums were concluded in the United Kingdom.
An analysis of the underwriting result before investment return is presented in the table below:
Year 2025
Gross
premiums
written
Gross
premiums
earned
Gross
claims
incurred
Gross
operating
expenses
Reinsurance
balance
Underwriting
result
£000
£000
£000
£000
£000
£000
Reinsurance acceptances
(243 )
(243 )
Total
(243 )
(243 )
Year 2024
Gross
premiums
written
Gross
premiums
earned
Gross
claims
incurred
Gross
operating
expenses
Reinsurance
balance
Underwriting
result
£000
£000
£000
£000
£000
£000
Reinsurance acceptances
(714 )
(185 )
(188 )
Total
(714 )
(185 )
(188 )
6. Net operating expenses
2025
2024
£000
£000
Acquisition costs
Administrative expenses
Net operating expenses
A commitment was received from the Big Wakam to absorb future operating expenses of the Syndicate.
Administrative expenses include a £250k RITC administration fee.
7.
Key management personnel compensation
No emoluments of the Directors of PMA or active underwriter were directly charged to the Syndicate, and
consequently no meaningful disclosure can be made.
No staff of PMA were directly charged to the Syndicate, and no other compensation was payable to key
management personnel.
8.
Staff numbers and costs
All staff are employed by the Managing Agent, the Syndicate has no employees.
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03935227
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9. Investment return
Investment return comprises bank interest received.
2025
2024
£000
£000
Interest and similar income
Total investment return
Transferred to the technical account from the non
‑
technical account
An investment return of nil was wholly allocated to the technical account.
10. Other debtors
2025
2024
£000
£000
Other related party balances
Other
Total
Other debtors consist of expenses to be reimbursed by Big Wakam £66k (2024: £12k).
11. Other creditors
2025
2024
£000
£000
Other liabilities
Total
Other liabilities consist of a £250k RITC administration fee payable to Syndicate 1254.
12. Technical provisions
The table below shows changes in the insurance contract liabilities and assets from the beginning of the
period to the end of the period.
2025
2024
Gross
provisions
£000
Net
£000
Gross
provisions
£000
Net
£000
Claims Outstanding
Balance at 1 January
Claims paid during the year
(12,977 )
(12,977 )
Expected cost of current year claims
Effect of movements in exchange rate
(160 )
(160 )
Balance at 31 December
-
-
-
-
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13. Cash and cash equivalents
2025
2024
£000
£000
Cash at bank and in hand
Total cash and cash equivalents
14. Analysis of net debt
1 Jan
Cash Flows
Fair value and
Exchange Movement
31 Dec
£000
£000
£000
£000
Cash and cash
equivalents
(34 )
Total
(34 )
15. Related parties
Syndicate
Big Wakam was the sole source of business written in the Syndicate, accordingly all premiums, commissions,
claims, insurance debtors and technical provisions relate to amounts payable and receivable from Big Wakam.
Big Wakam is also the owner of the wholly aligned corporate member (Wakam Corporate Member Limited).
Managing Agent
Polo Managing Agency Limited’s immediate parent undertaking is Marco Capital Holdings (UK) Limited, a
company incorporated in England and Wales. Registered address is 4th Floor, 24 Monument Street, London
EC3R 8AJ. Managing agency fees of £1.6m were paid by the Syndicate to PMA.
The Managing Agent’s ultimate parent undertaking is Marco Capital Holdings Limited, a company incorporated
in Malta. Registered address is 171 Old Bakery Street, Valletta, VLT1455, Malta.
The Managing Agent’s ultimate controlling party is Brookfield Oaktree Holdings, LLC (formerly known as
Oaktree Capital Group, LLC).
16. Off-balance sheet items
The Syndicate has not been party to an arrangement, which is not reflected in its balance sheet, where material
risks and benefits arise for the Syndicate.
17. Post balance sheet events
At the end of 2025 the Syndicate Reinsured to Close into Syndicate 1254, effective 1 January 2026. On 16
February 2026 the Syndicate received £250k in relation to the RITC agreement payable to Syndicate 1254.
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18. Foreign exchange rates
The following currency exchange rates have been used for principal foreign currency transactions:
2025
2024
Start of
the year
rate
Yearend
rate
Average
rate
Start of
the year
rate
Yearend
rate
Average
rate
Sterling
Euro
19. Funds at Lloyd’s
Every member is required to hold capital at Lloyd’s which is held in trust and known as Funds at Lloyd’s (“FAL”).
These funds are intended primarily to cover circumstances where Syndicate assets prove insufficient to meet
participating members’ underwriting liabilities. The level of FAL that Lloyd’s requires a member to maintain is
determined by Lloyd’s based on Prudential Regulation Authority requirements and resource criteria. The
determination of FAL has regard to a number of factors including the nature and amount of risk to be
underwritten by the member and the assessment of the reserving risk in respect of business that has been
underwritten. Since FAL is not under the management of the Managing Agent, no amount has been shown in
these Financial Statements by way of such capital resources. However, the Managing Agent is able to make a
call on the Member’s FAL to meet liquidity requirements or to settle losses.
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