Accounts disclaimer
Important information about Syndicate Reports and Accounts Access to this document is
restricted to persons who have given the certification set forth below. If this document has been
forwarded to you and you have not been asked to give the certification, please be aware that you
are only permitted to access it if you are able to give the certification. The syndicate reports and
accounts set forth in this section of the Lloyd’s website, which have been filed with Lloyd’s in
accordance with the Syndicate Accounting Byelaw (No. 8 of 2005), are being provided for
informational purposes only. The syndicate reports and accounts have not been prepared by
Lloyd’s, and Lloyd’s has no responsibility for their accuracy or content. Access to the syndicate
reports and accounts is not being provided for the purposes of soliciting membership in Lloyd’s
or membership on any syndicate of Lloyd’s, and no offer to join Lloyd’s or any syndicate is being
made hereby. Members of Lloyd’s are reminded that past performance of a syndicate in any
syndicate year is not predictive of the related syndicate’s performance in any subsequent
syndicate year. You acknowledge and agree to the foregoing as a condition of your accessing the
syndicate reports and accounts. You also agree that you will not provide any person with a copy
of any syndicate report and accounts without also providing them with a copy of this
acknowledgment and agreement, by which they will also be bound.
Munich Re Syndicate 0457
Annual Report and Accounts for the year ended
Contents
31 December 2025
1
Directors and Administration
2
Report of the Directors of the Managing Agent
3
Statement of Managing Agent’s responsibilities
7
Independent auditor’s report to the members of Syndicate 0457
8
Statement of Profit or Loss
12
Balance Sheet – Assets
14
Balance Sheet – Liabilities
15
Statement of Changes in Members’ Balances
16
Statement of Cash Flows
17
Notes to the Financial Statements
18
Directors and Administration
31 December 2025
2
Managing Agent
(the ‘Syndicate’) and is authorised by the Prudential Regulation Authority (‘PRA’) and
regulated by the Financial Conduct Authority (‘FCA’) and the Society of Lloyd’s (‘Lloyd’s’).
Directors
T E Artmann
Chief Executive Officer
S H Herrmann
Non-Executive Director
G K Hill
Chief Financial Officer
D J R Hoare
Group Chief Underwriting Officer
K E Mitra
Independent Non-Executive Director
T C Morgan
Independent Non-Executive Director
K A Morris
Independent Non-Executive Director
R I White
Independent Non-Executive Chair
Company Secretary
C M Zaremba
Registered Office
1 Fen Court, London, EC3M 5BN
Telephone: 020 7886 3900
E-mail: MRSL-central@munichre.com
Website: www.munichre.com
Registered Number
01328742
Syndicate
Chief Underwriting Officer
D J R Hoare
Bankers
Citibank N.A.
NatWest Group plc
Royal Bank of Canada
CACEIS Investor Services Bank S.A.
Investment Manager
Münchener Rückversicherungs-Gesellschaft Aktiengesellschaft
Registered Auditor
Ernst & Young LLP, 25 Churchill Place, London E14 5EY
Report of the Directors of the Managing Agent
31 December 2025
3
The Directors of the Managing Agent (‘the Directors’) present their report for the year ended
31 December 2025.
This annual report is prepared using the annual basis of accounting as required by Statutory
Instrument No 1950 of 2008, the Insurance Accounts Directive (Lloyd’s Syndicate and
Aggregate Accounts) Regulations 2008 (‘the 2008 Regulations’).
Results
The profit for calendar year 2025 is £208.5m (2024: profit of £197.5m). Profits will continue to
be distributed by reference to the results of individual underwriting years of account.
Principal Activity and Review of the Business
During 2025, the Syndicate’s principal activity remained the transaction of general insurance
and reinsurance business, with a particular focus on the Cyber, Green Solutions, Liability,
Marine Engineering and Specialty, Portfolio Solutions and Property sectors.
The Syndicate’s key financial indicators are as follows:
2025
2024
Gross Written Premium
£1,197.6m
£1,373.5m
Profit for the financial year
£208.5m
£197.5m
Combined Ratio
88.5%
87.1%
The combined ratio is the ratio of claims incurred (net of reinsurance) and operating expenses
(net of reinsurance) to earned premiums (net of reinsurance).
The Full Year financial result for 2025 has produced a net underwriting profit of £119.2m
(2024: profit of £142.7m).
Gross Written Premium (GWP) has reduced by £175.9m, a 12.8% decrease on prior year.
The main drivers for the reduction are in Property, Cyber, Cargo and Engineering classes.
The Directors believe that discipline and the proactive cycle management are key to the
Syndicate’s success. This approach allowed it to navigate previous cycle and emerge
stronger. The Board values having experienced Executives, the Group Chief Underwriting
Officer (‘CUO’), and Senior Underwriters who have successfully managed multiple market
cycles.
Report of the Directors of the Managing Agent
(continued)
31 December 2025
4
Principal Activity and Review of the Business (continued)
The following table provides a breakdown of gross written premiums by regulatory class
categories:
2025
%
2024
%
Direct insurance
Marine, Aviation and Transport
21
20
Fire and Other Damage to Property
42
43
Other
20
25
Reinsurance
17
12
Total
100
100
The Syndicate continues to buy an extensive reinsurance programme that is designed to
protect the Syndicate’s largest anticipated exposure from a single risk or multiple loss events.
The Syndicate utilises a mixture of Lloyd’s syndicates, UK authorised reinsurance companies
and international reinsurance companies to ensure comprehensive reinsurance cover is in
place. Some of the international companies are EU authorised insurers.
The following table provides an analysis of paid reinsurance premiums for 2025 and 2024:
2025
%
2024
%
Lloyd's Syndicates
21
20
UK Authorised Companies
21
20
EU Companies
38
38
Other Insurance Companies
20
22
100
100
Report of the Directors of the Managing Agent
(continued)
31 December 2025
5
Principal Risks and Uncertainties
The Board of MRSL (’the Board’) is responsible for overseeing the Syndicate’s risk
management framework, reviewing key risks and setting the risk appetite measures.
As an underwriting business, the Syndicate is exposed to a variety of financial and non-
financial risks. The principal risks to the Syndicate are insurance, credit, market, group,
operational, legal, regulatory and compliance risk and strategic risk. The Syndicate also pro-
actively manages its exposure to other risk areas including Environmental, Social and
Governance (‘ESG’) considerations through its participation in the Lloyds market. Detailed
explanations of these risks are provided in note 4 to these Financial Statements.
Directors
The Directors of the Managing Agent who held office during the year ended 31 December
2025 or as at the date of this report were as follows:
T E Artmann
S H Herrmann (Non-Executive)
M C Hewett (Independent Non-Executive) (resigned 31 March 2025)
G K Hill
D J R Hoare
K E Mitra (Independent Non-Executive) (appointed 6 January 2025)
T C Morgan (Independent Non-Executive)
K A Morris (Independent Non-Executive)
R I White (Independent Non-Executive Chair)
E Cabrera (appointed 21 January 2025) (resigned 10 October 2025)
Company Secretary
The Company Secretary of the Managing Agent who held office during the year ended 31
December 2025 is as follows:
C M Zaremba
Investments
Investment Policy and Managers
The Managing Agent has mandated Global Investment Managers (‘GIM’) to manage all of the
Syndicate funds not held in overseas deposits. GIM is a division of Munich Re in charge of
management of all Group investments. Detailed explanations of our investment policy,
managers and performance are provided in note 11 to these Financial Statements.
Future Developments
The directors believe that the Syndicate’s continued underwriting discipline, expertise, and
financial strength place it in a strong position to maintain performance under current market
conditions.
Report of the Directors of the Managing Agent
(continued)
31 December 2025
6
Syndicate Allocated Capacity and Membership of the Syndicate
The capacity of the Syndicate is based on Gross Net premiums and remained the same at
£1,500m for the 2026 year of account (2025 year of account: £1,500m). All of the capacity of
the Syndicate is provided by Munich Re Capital Limited (‘MRCL’), an indirect subsidiary of
Munich Re.
Going Concern
After making enquiries, the Board has a reasonable expectation that continued capital support
will be in place such that the Syndicate is able to write new business in future underwriting
years of account. The Board continues to adopt the going concern basis in preparing the
annual accounts.
Disclosure of Information to the Auditors
The Directors confirm that, to the best of their knowledge, there is no relevant audit information
undisclosed to the auditor, and they have taken all necessary steps to ensure the auditor is
aware of such information.
Auditors
In 2025, Munich Re Group took part in a tender for the audit services for the Munich Re
Specialty Group (‘MRSG’) of companies, including its managed syndicate. Following a
rigorous process and approval by the Audit Committee, the managing agent is pleased to
announce that it will appoint KPMG as its auditor for financial periods incepting on or after
January 2026. EY LLP will resign as auditor following completion of the 31 December 2025
audit.
Approved on 16 February 2026 by a resolution of the Board of Directors of Munich Re
Syndicate Limited and signed on its behalf.
R I White
D J R Hoare
Independent Non-Executive Chair
Group Chief Underwriting Officer
18
th
February 2026
18
th
February 2026
Statement of Managing Agent’s responsibilities
31 December 2025
7
The Directors of the Managing Agent are responsible for:
x
Preparing the Syndicate annual accounts in accordance with applicable law and
regulations.
x
Preparation and review of the iXBRL tagging that has been applied to the Syndicate
annual 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 Insurance Accounts Directive (Lloyd’s Syndicate and Aggregate Accounts) Regulations
2008 require the Managing Agent to prepare Syndicate annual 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 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 accounts, the Managing Agent is required to:
x
Select suitable accounting policies and then apply them consistently;
x
Make judgements and estimates that are reasonable and prudent;
x
State whether applicable UK Accounting Standards have been followed, subject to any
material departures disclosed and explained in the notes to the Syndicate accounts; and
x
Prepare the Syndicate 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.
The Managing Agent is responsible for keeping adequate accounting records which disclose
with reasonable accuracy at any time the financial position of the Syndicate and enable it to
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 the 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 version 3.1 as modified by the Frequently Asked Questions version 1.1
issued by Lloyd’s.
On behalf of the Board
R I White
Independent Non-Executive Chair
18
th
February 2026
Independent auditor’s report to the members of
Syndicate 0457
31 December 2025
8
Opinion
We have audited the syndicate annual accounts of syndicate 0457 (‘the syndicate’) for the year
ended 31 December 2025 which comprise the Statement of Profit or Loss, the Balance Sheet, the
Statement of Changes in Members’ Balances, the Statement of Cash Flows and the related notes
1 to 29, including a summary of significant accounting policies. The financial reporting framework
that has been applied in their preparation is applicable law including 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 Section 1 of the Lloyd’s Syndicate Accounts Instructions version 3.1,
as modified by the Frequently Asked Questions version 1.1 (‘the Syndicate Accounts Instructions’).
In our opinion, the syndicate annual accounts:
x
give a true and fair view of the syndicate’s affairs as at 31 December 2025 and of its profit
for
the year then ended;
x
have been properly prepared in accordance with United Kingdom Generally Accepted
Accounting Practice; and
x
have been prepared in accordance with the requirements of The Insurance Accounts Directive
(Lloyd’s Syndicate and Aggregate Accounts) Regulations 2008 and the 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 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 as applied to other entities of public interest, 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.
Conclusions relating to going concern
In auditing the syndicate annual accounts, we have concluded that the managing agent’s use of
the going concern basis of accounting in the preparation of the syndicate annual accounts is
appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating
to events or conditions that, individually or collectively, may cast significant doubt on the syndicate’s
ability to continue as a going concern for a period of 12 months from when the syndicate annual
accounts are authorised for issue.
Our responsibilities and the responsibilities of the directors of the managing agent with respect to
going concern are described in the relevant sections of this report. However, because not all future
events or conditions can be predicted, this statement is not a guarantee as to the syndicate’s ability
to continue as a going concern.
Independent auditor’s report to the members of
Syndicate 0457 (continued)
31 December 2025
9
Other information
The other information comprises the information included in the Annual Report and Accounts, other
than the syndicate annual accounts and our auditor’s report thereon. The directors of the managing
agent are responsible for the other information contained within the 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 this 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 the
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:
x
the information given in the managing agent’s report for the financial year in which the
syndicate annual accounts are prepared is consistent with the syndicate annual accounts; and
x
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 where The Insurance Accounts
Directive (Lloyd’s Syndicate and Aggregate Accounts) Regulations 2008 requires us to report to
you, if in our opinion:
x
the managing agent in respect of the syndicate has not kept adequate accounting records; or
x
the syndicate annual accounts are not in agreement with the accounting records; or
x
certain disclosures of the managing agent’s emoluments specified by law are not made; or
x
we have not received all the information and explanations we require for our audit.
Responsibilities of the directors of the managing agent
As explained more fully in the Statement of Managing Agent’s Responsibilities set out on page 7,
the directors of the managing agent are 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
they determine is necessary to enable the preparation of the syndicate annual accounts that are
free from material misstatement, whether due to fraud or error.
In preparing the syndicate annual accounts, the directors of the managing agent are responsible
for assessing the syndicate’s ability to continue in operation, disclosing, as applicable, matters
related to its ability to continue in operation and using the going concern basis of accounting unless
the directors of the managing agent either intends to cease to operate the syndicate, or has no
realistic alternative but to do so.
Independent auditor’s report to the members of
Syndicate 0457 (continued)
31 December 2025
10
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.
Explanation as to what extent the audit was considered capable of detecting
irregularities, including fraud
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We
design procedures in line with our responsibilities, outlined above, to detect irregularities, including
fraud. The risk of not detecting a material misstatement due to fraud is higher than the risk of not
detecting one resulting from error, as fraud may involve deliberate concealment by, for example,
forgery or intentional misrepresentations, or through collusion.
The extent to which our procedures are capable of detecting irregularities, including fraud, is
detailed below. However, the primary responsibility for the prevention and detection of fraud rests
with both those charged with governance of the managing agent and management.
Our approach was as follows:
x
We obtained a general understanding of the legal and regulatory frameworks that are
applicable to the syndicate and determined that the most significant are direct laws and
regulations related to elements of Lloyd’s Byelaws and Regulations, and the financial reporting
framework (United Kingdom Generally Accepted Accounting Practice), and requirements
referred to by Lloyd’s in the Syndicate Accounts Instructions. Our considerations of other laws
and regulations that may have a material effect on the syndicate annual accounts included
permissions and supervisory requirements of Lloyd’s of London, the Prudential Regulation
Authority (‘PRA’) and the Financial Conduct Authority (‘FCA’).
x
We obtained a general understanding of how the syndicate is complying with those
frameworks by making enquiries of management, internal audit, and those responsible for
legal and compliance matters of the syndicate. In assessing the effectiveness of the control
environment, we also reviewed significant correspondence between the syndicate, Lloyd’s of
London and other UK regulatory bodies; reviewed minutes of the Board and Audit Committee
of the managing agent; and gained an understanding of the managing agent’s approach to
governance.
x
For direct laws and regulations, we considered the extent of compliance with those laws and
regulations as part of our procedures on the related syndicate annual accounts’ items.
x
For both direct and other laws and regulations, our procedures involved: making enquiries of
the directors of the managing agent and senior management for their awareness of any non-
compliance of laws or regulations, enquiring about the policies that have been established to
prevent non-compliance with laws and regulations by officers and employees, enquiring about
the managing agent’s methods of enforcing and monitoring compliance with such policies,
and inspecting significant correspondence with Lloyd’s, the PRA and the FCA.
x
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 had the appropriate competence and capabilities, which included
the use of specialists where appropriate.
Independent auditor’s report to the members of
Syndicate 0457 (continued)
31 December 2025
11
x
We assessed the susceptibility of the syndicate’s annual accounts to material misstatement,
including how fraud might occur by considering the controls that the directors of the managing
agent have established to address risks identified by them, or that otherwise seek to prevent,
deter or detect fraud. We also considered areas of significant judgement, complex
transactions, performance targets, economic or external pressures and the impact these have
on the control environment. Where this risk was considered to be higher, we performed audit
procedures to address each identified fraud risk. These procedures included testing a sample
of manual journals and were designed to provide reasonable assurance that the syndicate
annual accounts were free from fraud or error.
Our procedures included:
x
Considering accounting estimates for evidence of management bias. Supported by our
actuaries we assessed if there were any indicators of management bias in the valuation of
gross incurred but not reported reserves and the valuation of estimated premium income.
x
Testing the appropriateness of journal entries recorded in the general ledger on a sample
basis.
A further description of our responsibilities for the audit of the annual accounts is located on the
Financial Reporting Council’s website at https://www.frc.org.uk/auditorsresponsibilities. This
description forms part of our auditor’s report.
Other matter
Our opinion on the syndicate annual accounts does not cover the iXBRL tagging included within
these syndicate annual accounts, and we do not express any form of assurance conclusion
thereon.
Use of our report
This report is made solely to the syndicate’s members, as a body, in accordance with 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.
Angus Millar (Senior statutory auditor)
for and on behalf of Ernst & Young LLP, Statutory Auditor
London
Statement of Profit or Loss
31 December 2025
12
Technical Account – General Business
For the year ended 31 December 2025
Note
2025
2024
£000
£000
Gross premiums written
4
Outwards reinsurance premiums
(204,423 )
(175,530 )
Premiums written, net of reinsurance
Changes in unearned premium
17
Change in the gross provision for unearned premiums
(29,107 )
(119,152 )
Change in the provision for unearned premiums reinsurers’ share
Net change in provisions for unearned premiums
(7,819 )
(109,876 )
Earned premiums, net of reinsurance
Allocated investment return transferred from the non-technical account
9
Other technical income, net of reinsurance
Claims paid
17
Gross amount
(482,450 )
(440,601 )
Reinsurers’ share
Net claims paid
(437,992 )
(369,946 )
Change in the provision for claims
17
Gross amount
(161,129 )
(243,689 )
Reinsurers’ share
Net change in provisions for claims
(54,332 )
(188,003 )
Claims incurred, net of reinsurance
(492,324 )
(557,949 )
Net operating expenses
6
(379,774 )
(390,279 )
Balance on the technical account – general business
All operations relate to continuing activities.
The notes on pages 18 to 53 form an integral part of these annual accounts.
Statement of Profit or Loss
31 December 2025
13
Non-Technical Account – General Business
For the year ended 31 December 2025
Note
2025
2024
£000
£000
Balance on the technical account – general business
Investment income
9
Realised gains on investments
9
Unrealised gains on investments
9
Investment expenses and charges
9
(1,634 )
(1,056 )
Total investment return
Allocated investment return transferred to the general business technical
account
(73,466 )
(49,522 )
Gain/(Loss) on foreign exchange
(4,105 )
Other income
9
Profit for the financial year
All operations relate to continuing activities.
There were no recognised gains and losses in the year other than those reported in the
Statement of Profit or Loss and hence no Statement of Other Comprehensive Income has
been presented.
The notes on pages 18 to 53 form an integral part of these annual accounts.
Balance Sheet - Assets
31 December 2025
14
As at 31 December 2025
Note
2025
2024
£000
£000
Financial investments
11
Deposits with ceding undertakings
Investments
Provision for unearned premiums
Claims outstanding
Reinsurers’ share of technical provisions
17
Debtors arising out of direct insurance operations
12
Debtors arising out of reinsurance operations
13
Other debtors
14
Debtors
Cash at bank and in hand
Other assets
Deferred acquisition costs
15
Other prepayments and accrued income
Prepayments and accrued income
Total assets
The notes on pages 18 to 53 form an integral part of these annual accounts.
Balance Sheet - Liabilities
31 December 2025
15
As at 31 December 2025
The Syndicate annual accounts on pages 12 to 53 were approved by the Board of Munich Re
Syndicate Limited on 16
th
February 2026 and were signed on its behalf by
R I White
Independent Non-Executive Chair
18
th
February 2026
Note
2025
2024
£000
£000
Members’ balances
Total capital and reserves
Provision for unearned premiums
17
Claims outstanding
16
Other technical provisions
Technical provisions
Creditors arising out of direct insurance operations
19
Creditors arising out of reinsurance operations
20
Other creditors including taxation and social security
21
Creditors
Accruals and deferred income
15
Total liabilities
Total liabilities, capital and reserves
Statement of Changes in Members’ Balances
For the year ended 31 December 2025
31 December 2025
16
2025
2024
£000
£000
Members’ balances brought forward at 1 January
Total comprehensive income for the year
Payments of profit to members’ personal reserve funds
(121,395 )
(133,597 )
Net movement on funds in syndicate
(116,832 )
Other
(3,804 )
Members’ balances carried forward at 31 December
Members participate on syndicates by reference to years of account and their ultimate result,
assets and liabilities are assessed with reference to policies incepting in that year of account
in respect of their membership of a particular year.
The notes on pages 18 to 53 form an integral part of these annual accounts.
Statement of Cash Flows
For the year ended 31 December 2025
31 December 2025
17
Note
2025
2024
£000
£000
Cash flows from operating activities
Profit for the financial year
Adjustments:
Increase in gross technical provisions
Increase in reinsurers’ share of gross technical provisions
(126,456 )
(63,670 )
Decrease/(Increase) in debtors
(192,818 )
Increase in creditors
Investment return
(58,951 )
Foreign exchange
Net cash flows from operating activities
Cash flows from investing activities
Purchase of debt instruments
(2,456,937 ) (1,387,663 )
Sale of debt instruments
Investment income received
Other
(4,310 )
Net cash flows from investing activities
(421,034 )
(295,047 )
Cash flows from financing activities
Distribution of profit
(121,395 )
(133,597 )
Funds In Syndicate (released to)/paid from members
(116,832 )
Other
Net cash flows from financing activities
(229,684 )
(70,597 )
Net (decrease)/increase in cash and cash equivalents
(7,031 )
Cash and cash equivalents at the beginning of the year
Foreign exchange on cash and cash equivalents
(5,807 )
Cash and cash equivalents at the end of the year
22
The notes on pages 18 to 53 form an integral part of these annual accounts.
Notes to the Financial Statements (continued)
31 December 2025
18
1. Basis of Preparation
The Syndicate comprises a single corporate member of Lloyd’s, MRCL, that underwrites
insurance business in the London Market. The address of the Syndicate’s managing agent is
1 Fen Court,
London, EC3M 5BN.
The financial statements have been prepared in accordance with the Insurance Accounts
Directive (Lloyd’s Syndicate and Aggregate Accounts) Regulations 2008, applicable
Accounting Standards in the United Kingdom and the Republic of Ireland, including Financial
Reporting Standard 102 (FRS 102), Financial reporting standard 103 (FRS 103) in relation to
insurance contracts, 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 financial statements follow the historical cost basis, except for financial assets at fair value.
Statements are presented in Pound Sterling (‘GBP’), rounded to the nearest thousand.
Going Concern
The Syndicate has sufficient resources to meet its financial and insurance risk needs. The
Directors have reviewed its plans, liquidity, and resilience, and are confident in its ability to
manage current risks. The 2026 year of account is open, with a reasonable expectation to
open a 2027 year.
The Syndicate has adequate capital for each year of account. As underwriting continues, the
Directors have adopted the going concern basis for preparing the financial statements.
2. Use of Judgements and Estimates
In preparing these financial statements, the Directors of the Managing Agent have made
judgements, estimates and assumptions that affect the application of the Syndicate’s
accounting policies and the reported amounts of assets, liabilities, income and expenses.
The following critical judgements have been made in applying the Syndicate’s accounting
policies:
Claims Reserving
Claims provisions involve judgement and assumptions about future events. They cover all
incurred claims, including those incurred but not yet reported (‘IBNR’), and are estimated by
in-house actuaries using statistical methods and past experience, adjusted for recent trends
and underwriting conditions. Provisions also include handling costs and a margin above the
best estimate to allow for uncertainty. As with all estimates, actual outcomes may differ from
those assumed.
The estimates and assumptions that have a significant risk of causing a material adjustment
to the carrying amounts of assets and liabilities within the next financial year are addressed
below.
Premium Estimates
Written premium for closed years is based on signings. For open years, ultimate premium
estimates use business plans, underwriter Estimated Premium Income (‘EPI’), and actuarial
projections. Early estimates rely on business plans and underwriting input; later, more weight
is given to EPI and actuarial data as signings mature.
Notes to the Financial Statements (continued)
31 December 2025
19
2. Use of Judgements and Estimates (continued)
Premium Estimates (continued)
The gross premium estimate of £459.1m (2024: £552.1m) is included in the ‘Debtors arising
out of direct insurance operations’ with the reinsurance share of £100.0m (2024: £59.9m)
being included in the ‘Creditors arising out of direct insurance operations’ and ‘Creditors arising
out of reinsurance operations’ on the Balance Sheet (pages 14 and 15 respectively).
Earned and written premium patterns are based on prior-year policy data, with expert input for
newer or variable classes. Premiums are earned pro rata over the policy term, or adjusted
where risk exposure differs from the contract period.
3. Significant Accounting Policies
The following principal accounting policies have been applied consistently in dealing with items
which are considered material in relation to the Syndicate’s annual accounts.
(a) Premiums Written
Gross premiums written include direct and inwards reinsurance business, before commission
and excluding taxes. They reflect notified and pipeline premiums, plus adjustments to prior
estimates. Facility contracts (e.g., binders, consortia) are written in line with the expected
profile of underlying business. Outwards reinsurance premiums are recorded in the same
period as the related inwards business. Premiums are earned from risk attachment over the
coverage period based on the risk profile.
(b)
Unearned Premiums
The unearned premium provision represents the portion of written premiums relating to future
risk periods. Premiums are earned based on the policy’s risk profile, using established
earnings patterns or time apportionment for unexpired terms at the balance sheet date.
(c)
Reinsurance
The Syndicate assumes and cedes reinsurance in the ordinary course of business. Premiums
and claims on assumed reinsurance follow the same recognition basis as direct business.
Ceded premiums and recoveries are recorded gross in the Technical Account and Balance
Sheet. Written and earned patterns are applied separately for Facultative, Proportional, and
Excess of Loss reinsurance. Reinstatement premiums are earned pro-rata over the term of
the original policy.
(d)
Claims Provisions and Related Recoveries
Claims incurred include claims paid, claims handling expenses, and changes in outstanding
claims provisions. The Syndicate does not discount outstanding claims or related reinsurance
recoveries. Outstanding claims cover reported cases and IBNR, estimated using individual
assessments and actuarial projections based on past claims development and external
factors.
Key assumptions are that past claims trends predict future outcomes and that current rating
models fairly estimate ultimate claims. The Directors believe provisions are fairly stated but
acknowledge that future information may cause significant adjustments. Changes to prior year
provisions are reflected in the period they occur, and methods and estimates are regularly
reviewed.
Notes to the Financial Statements (continued)
31 December 2025
20
3. Significant Accounting Policies (continued)
(d)
Claims Provisions and Related Recoveries (continued)
The reinsurers’ share of claims provisions is based on outstanding claims and IBNR
projections, adjusted for irrecoverable amounts, reinsurance coverage, claims experience, and
reinsurer credit ratings, using various statistical methods.
Reinsurance assets are reviewed for impairment at each balance sheet date. If recovery is
doubtful due to a specific event, an impairment loss is recognised in the Statement of Profit or
Loss for that period.
(e)
Liability Adequacy Test Provision
A provision for unexpired risks is made when expected claims and expenses exceed unearned
premiums (net of deferred acquisition costs) for policies in force. This is calculated by business
class. As of 31 December 2025, no unexpired risk provision was required (2024: £Nil).
(f)
Acquisition Costs
Acquisition costs for general insurance contracts, including brokerage, commissions, and
related admin expenses, are deferred. The deferred acquisition cost asset matches the
unearned portion of gross premiums. Costs also cover International Distribution Companies
(‘IDC’) fees and a share of Syndicate expenses like box rent, underwriters’ salaries, and
allocated accommodation and IT costs.
(g)
Foreign Currencies
The Syndicate’s functional and presentational currency is GBP, consistent with prior years.
Non-monetary foreign currency items at historic cost are translated using the transaction date
exchange rate. Unearned premiums and deferred acquisition costs are treated as monetary
items for currency translation. Translation differences related to insurance operations are
recorded in the non-technical account.
(h)
Financial Assets and Liabilities
The Syndicate applies FRS 102 Chapters 11 and 12 for recognition and measurement of
financial instruments.
Classification
Financial assets and liabilities are classified at initial recognition based on contractual terms.
Reclassification only occurs if contractual terms change materially. Assets/liabilities at fair
value through profit or loss include those held for trading or designated on initial recognition,
such as shares, unit trusts, and fixed income securities. Deposits and debtors are classified
as loans and receivables.
Recognition
Financial instruments are recognised when contractual rights exist. Assets are derecognised
when rights expire or are transferred without retaining risks/rewards. Liabilities are
derecognised when obligations are settled, cancelled, or expired. Purchases/sales are
recognised on trade date.
Notes to the Financial Statements (continued)
31 December 2025
21
3. Significant Accounting Policies (continued)
(h)
Financial Assets and Liabilities (continued)
Measurement
Financial instruments are initially recognised at fair value, with transaction costs added where
the asset or liability is not measured at fair value through profit or loss. Instruments held at fair
value through profit or loss are subsequently remeasured at fair value with changes recognised
in profit or loss. Loans and receivables are carried at historic cost and measured at amortised
cost using the effective interest method, subject to impairment. Non
-
derivative financial
liabilities are also measured at amortised cost.
Identification and Measurement of Impairment
At each reporting date, the Syndicate assesses if there is objective evidence of impairment for
financial assets not at fair value through profit or loss. Impairment occurs when a loss event
after initial recognition affects future cash flows and can be reliably estimated.
Evidence includes significant financial difficulty of the issuer or major changes in the issuer’s
environment.
Impairment on amortised cost assets is the difference between carrying amount and the
present value of estimated future cash flows discounted at the original effective interest rate.
Significant assets are tested individually; others are grouped by credit risk.
Impairment losses reduce the carrying amount and are recognised in profit or loss. Reversals
are recognised if linked to events after impairment and are recorded in profit or loss.
Off-setting
Financial assets and liabilities are offset and presented net in the Balance Sheet only when
the Syndicate has a legal right to do so and intends to settle on a net basis or simultaneously.
(i)
Investment Return
Investment return includes investment income, realised gains, unrealised gains and losses on
financial instruments at fair value through profit or loss, minus investment management
expenses, interest expense, realised losses, and impairments.
Interest on financial assets measured at amortised cost is recognised using the effective
interest rate method, excluding transaction costs for fair value through profit or loss assets.
Realised gains/losses are the difference between sale proceeds and purchase price.
Unrealised gains/losses reflect changes in fair value between balance sheet dates or
acquisition cost. Movements include current period value changes and reversals of prior
unrealised gains/losses on disposals.
Investment return is first recorded in the non-technical account, then fully transferred to the
general business technical account to reflect returns on underwriting funds.
Notes to the Financial Statements (continued)
31 December 2025
22
3. Significant Accounting Policies (continued)
(j)
Cash and Cash Equivalents
Cash and cash equivalents include cash balances and call deposits maturing within three
months from acquisition, with minimal risk of fair value changes, used to manage the
Syndicate’s short-term obligations.
(k)
Taxation
Under Schedule 17 of the Finance Act 1997, Syndicates do not deduct basic rate income tax
from trading income. UK basic rate tax (currently 20%) deducted from syndicate investment
income is recoverable by Managing Agents, so distributions to members are made gross of
tax.
Capital appreciation is treated as trading income and also distributed gross of tax. Payments
on account made during the year are shown as ‘other debtors’ in the Balance Sheet.
No provision is made for any overseas tax payable by members on underwriting results.
(l)
Pension Costs
MRSL participates in a funded defined benefit pension scheme, closed to new members in
2000 and to future accruals from 31 December 2009. In 2014, all active members were
transferred to a defined contribution scheme or a Group Self-Invested Pension Plan.
Scheme assets are held separately with Barclays Stockbrokers. Contributions are charged to
the Statement of Profit or Loss and included in net operating costs, spreading costs over
employees' service lives. Contributions for staff acting for the Syndicate are charged to the
Syndicate.
The latest triennial valuation (31 December 2024 ) showed a surplus of £23.0m (25%), mainly
due to better-than-expected investment returns, partially offset by changes in assumptions.
(m)
Profit Commission
The Managing Agent does not charge any profit commission.
(n)
Deposits with Ceding Undertakings
Deposits with ceding undertakings are funds held by Lloyd’s Europe on behalf of the Syndicate
to settle Part VII claims.
(o)
Deposits Received from Reinsurers
Deposits received from reinsurers include advance payments for future claims under
reinsurance arrangements, held at amortised cost. Currently, no such funds are held on the
Balance Sheet.
(p)
Operating Expenses
Expenses incurred by the IDC for Syndicate administration are apportioned based on expense
type. Joint expenses are allocated between the IDC and the Syndicate based on work
performed, resources used, and business volume.
Notes to the Financial Statements (continued)
31 December 2025
23
3. Significant Accounting Policies (continued)
(q)
Reinsurers’ Commission and Profit Participation
Reinsurers’ commissions and profit participations are treated as contributions to expenses.
(r)
Debtors and Creditors
Insurance and reinsurance debtors and creditors include amounts due from or to agents,
brokers, reinsurers, and other counterparties. They are classified as debt instruments and
measured at amortised cost, with debtors reduced for any impairments.
Insurance transactions are via intermediaries, with no direct policyholder debtors. Reinsurance
debtors mainly relate to settled claims recoveries; creditors are primarily reinsurance
premiums payable.
Other debtors include amounts from members and sundry items; other creditors include
related party balances, profit commissions, and sundry payables—all measured at amortised
cost.
(s)
Classification of Insurance and Reinsurance Contracts
Contracts are classified as insurance contracts if they transfer significant insurance risk;
otherwise, they are treated as financial instruments. All contracts written or purchased by the
Syndicate transfer significant risk and are recognised as insurance contracts.
4. Risk and Capital Management
Introduction and Overview
This note outlines the insurance and financial risks the Syndicate faces, along with the
Managing Agent’s objectives, policies, and processes for risk and capital management.
Risk Management Framework
As an underwriting business, the Syndicate is exposed to a variety of financial and non-
financial risks. These risks, which shape the risk management strategy adopted by MRSL are
integral to the capital setting process that is undertaken to ensure there is an appropriate level
of capital held in respect of the insurance liabilities to which the Syndicate is exposed. The
Own Risk and Solvency Assessment (‘ORSA’) undertaken in respect of the Syndicate also
reflects the risk profile of the business as well as the business strategy.
Risks are managed through the risk management framework and underlying risk processes in
order to ensure that the risk profile of the business is fully understood and can be monitored
against agreed Board risk appetites. Board approved risk appetite measures are monitored on
a quarterly basis, and any breaches are appropriately escalated and managed accordingly.
Notes to the Financial Statements (continued)
31 December 2025
24
4. Risk and Capital Management (continued)
Insurance Risk
Insurance risk is the risk of adverse financial outcomes due to actual claims differing from
expectations at the time of product design and pricing. It stems from uncertainty in the
occurrence, timing, and amount of insurance premiums and liabilities.
Management of Insurance Risk
The Syndicate manages underwriting risk through a disciplined underwriting strategy focused
on maintaining a diverse, balanced global portfolio across various underwriting classes. The
annual Syndicate Business Forecast (SBF) outlines business classes, territories, average line
size, and types of assured. The Board regularly monitors performance against the SBF.
MRSL purchases reinsurance in accordance with the approved Reinsured Security list which
sets out the approved reinsurers that meet the required security standards. The Reinsurance
Security list is reviewed annually prior to treaty placement.
Contract erosion is monitored monthly, and any adverse trends are escalated. Quarterly
independent peer reviews are also reported to the MRSL Executive Committee.
Catastrophe modelling software is utilised to model maximum probable losses from
catastrophe exposed business. The Board regularly monitors reserve adequacy, and detailed
independent reviews of underwriting areas are conducted regularly.
Concentration of Insurance Risk
The following table provides an analysis of the breakdown of its gross written premium.
USA
UK
Canada
Australia
Rest of
the
World
Total
2025
£000
£000
£000
£000
£000
£000
Direct insurance
Marine, Energy, Aviation and
Transport
35,800
5,162
5,688
848
207,774
255,272
Fire and other damage to
property
159,246
44,234
36,163
18,641
240,204
498,488
Third party liability
6,003
11,215
27
410
161,305
178,960
Accident & Health
10
5
-
7
590
612
Motor
989
13
-
-
2,274
3,276
Miscellaneous
5,904
2,872
20
290
45,743
54,829
Total Direct insurance
207,952
63,501
41,898
20,196
657,890
991,437
Reinsurance
59,845
2,525
129
913
142,753
206,165
Total
267,797
66,026
42,027
21,109
800,643
1,197,602
Notes to the Financial Statements (continued)
31 December 2025
25
4.
Risk and Capital Management (continued)
Insurance Risk (continued)
Concentration of Insurance Risk (continued)
Sensitivity to Insurance Risk
The liabilities established could be significantly lower or higher than the ultimate cost of settling
the claims arising.
This uncertainty varies by business class and risk type, arising from case
reserving changes for large losses, catastrophes, or claims IBNR estimates.
The Syndicate uses both its own and commercially available proprietary risk management
software to assess catastrophe exposure. However, there is always a risk that the assumptions
and techniques used in these models are unreliable or that claims arising from an unmodelled
event are greater than those arising from a modelled event.
The following table presents the sensitivity of the value of insurance liabilities disclosed in the
accounts to potential movements in the assumptions applied within the technical provisions.
Given the nature of the business underwritten by the Syndicate, the approach to calculating
the technical provisions for each class can vary and as a result the sensitivity performed is to
apply a beneficial and adverse risk margin to the total insurance liability.
The amount disclosed in the table represents the profit or loss impact of an increase or
decrease in the insurance liability as a result of applying the sensitivity. The amount disclosed
for the impact on claims outstanding – net of reinsurance represents the impact on both the
profit or loss for the year and member balance.
USA
UK
Canada
Australia
Rest of
the
World
Total
2024
£000
£000
£000
£000
£000
£000
Direct insurance
Marine, Energy, Aviation and
Transport
42,851
6,601
8,155
676
215,481
273,764
Fire and other damage to
property
160,516
65,647
30,599
16,559
313,127
586,448
Third party liability
9,542
15,331
-
184
204,062
229,119
Accident & Health
74
87
-
51
2,686
2,898
Motor
4,192
15
-
-
750
4,957
Miscellaneous
12,594
5,031
82
328
91,319
109,354
Total Direct insurance
229,769
92,712
38,836
17,798
827,425
1,206,540
Reinsurance
37,874
1,724
158
346
126,825
166,927
Total
267,643
94,436
38,994
18,144
954,250
1,373,467
Notes to the Financial Statements (continued)
31 December 2025
26
4. Risk and Capital Management (continued)
Insurance Risk (continued)
Sensitivity to Insurance Risk (continued)
General insurance business sensitivities as at 31 December 2025
Sensitivity
5.00%
-5.00%
£000
£000
Claims outstanding – gross of reinsurance
(79,926 )
Claims outstanding – net of reinsurance
(58,867 )
General insurance business sensitivities as at 31 December 2024
Sensitivity
5.00%
-5.00%
£000
£000
Claims outstanding – gross of reinsurance
(75,426 )
Claims outstanding – net of reinsurance
(58,825 )
Financial Risk
The Syndicate’s financial risk management focuses on ensuring asset proceeds cover
insurance obligations. The investment process aims to optimise risk-adjusted returns through
a diversified portfolio, managing assets and liabilities by cash flow and duration matching. Key
financial risks include credit, liquidity, and market risks.
a) Credit Risk
Credit risk is the risk of financial loss to the Syndicate, if a counterparty fails to discharge a
contractual obligation. Key counterparties include reinsurers, brokers, coverholders,
investments and other counterparties.
The Board requires all reinsurers, brokers, and
coverholders to be pre-approved.
i.
Management of Credit Risk
The potential for losses arising from a counterparty failing to fulfil its contracted payment
obligations is managed by control procedures. Aged debt in respect of the payment of
premiums and reinsurance recoveries is monitored and actively managed.
Credit risk arising from investment counterparties is limited by both Lloyd’s and MRSL
investment mandates, which set strict criteria on allowable counterparties and concentration
limits. Compliance with these mandates is monitored daily by the appointed investment
managers, MEAG.
ii. Exposure to Credit Risk
The following table analyses the credit rating by investment grade of financial investments,
reinsurers’ share of claims outstanding, debtors arising out of direct insurance and reinsurance
operations, cash at bank and in hand, and other debtors and accrued interest for assets that
are neither past due nor impaired.
Notes to the Financial Statements (continued)
31 December 2025
27
4. Risk and Capital Management (continued)
Financial Risk (continued)
a)
Credit Risk (continued)
ii. Exposure to Credit Risk (continued)
Year 2025
AAA
AA
A
BBB
Other
Not
rated
£000
Total
£000
£000
£000
£000
£000
£000
Debt securities and other fixed
income securities
Loans and deposits with credit
institutions
Syndicate loans to central fund
Deposits with ceding
undertakings
Reinsurers’ share of claims
outstanding
Debtors arising out of direct
insurance operations
Debtors arising out of
reinsurance operations
Cash at bank and in hand
Other debtors
Total
Year 2024
AAA
AA
A
BBB
Other
Not
rated
£000
Total
£000
£000
£000
£000
£000
£000
Debt securities and other fixed
income securities
Loans and deposits with credit
institutions
Syndicate loans to central fund
Deposits with ceding
undertakings
Reinsurers’ share of claims
outstanding
Debtors arising out of direct
insurance operations
Debtors arising out of
reinsurance operations
Cash at bank and in hand
Other debtors
Total
Notes to the Financial Statements (continued)
31 December 2025
28
4. Risk and Capital Management (continued)
Financial Risk (continued)
a)
Credit Risk (continued)
iii.
Financial Assets that are past due or impaired
The Syndicate has debtors arising from direct insurance and reinsurance operations that are
past due but not impaired at the reporting date. The Syndicate does not consider these debtors
to be impaired on the basis they are still deemed and confirmed to be collectable.
These debtors have been individually assessed for impairment by considering information
such as the occurrence of significant changes in the counterparty’s financial position, patterns
of historical payment information and disputes with counterparties.
An analysis of the carrying amounts of past due or impaired debtors is presented in the table
below:
Neither past
due nor
impaired
assets
Past due
but not
impaired
assets
Impairment
allowance
Total
2025
£000
£000
£000
£000
Debt securities and other fixed income securities
Syndicate loans to central fund
Other investments
Deposits with ceding undertakings
Reinsurers' share of claims outstanding
Debtors arising out of direct insurance operations
Debtors arising out of reinsurance operations
(9 )
Other debtors
Cash at bank and in hand
Total
(9 )
Neither past
due nor
impaired
assets
Past due
but not
impaired
assets
Impairment
allowance
Total
2024
£000
£000
£000
£000
Debt securities and other fixed income securities
Syndicate loans to central fund
Other investments
Deposits with ceding undertakings
Reinsurers' share of claims outstanding
Debtors arising out of direct insurance operations
Debtors arising out of reinsurance operations
(9 )
Other debtors
Cash at bank and in hand
Total
(9 )
Notes to the Financial Statements (continued)
31 December 2025
29
4. Risk and Capital Management (continued)
Financial Risk (continued)
a)
Credit Risk (continued)
iii.
Financial Assets that are past due or impaired (continued)
The table below sets out a reconciliation of changes in impairment allowance during the period
for each class of financial asset at the balance sheet date:
1 Jan
New
impairment
charges
added in
y
ear
Changes in
impairment
char
g
es
Released
to profit
and loss
account
31 Dec
2025
£000
£000
£000
£000
£000
Debtors arising out of direct insurance
operations
Debtors arising out of reinsurance
operations
(9 )
(9 )
Total
(9 )
(9 )
1 Jan
New
impairment
charges
added in
y
ear
Changes in
impairment
char
g
es
Released
to profit
and loss
account
31 Dec
2024
£000
£000
£000
£000
£000
Debtors arising out of direct insurance
operations
Debtors arising out of reinsurance operations
(9 )
(9 )
Total
(9 )
(9 )
The table below sets out the age analysis of financial assets that are past due but not impaired
at the balance sheet date:
Past due but not impaired
0-3 months
past due
3-6 months
past due
6-12
months
past due
Greater than
1 year past
due
Total
2025
£000
£000
£000
£000
£000
Debtors arising out of direct insurance operations
Debtors arising out of reinsurance operations
Other debtors
Total
Notes to the Financial Statements (continued)
31 December 2025
30
4. Risk and Capital Management (continued)
Financial Risk (continued)
a)
Credit Risk (continued)
iii.
Financial Assets that are past due or impaired (continued)
b)
Liquidity Risk
Liquidity risk is the risk that the Syndicate may struggle to meet obligations from insurance
contracts and financial liabilities, especially during catastrophic events where claim payments
may precede reinsurance recoveries. The cash flow is monitored against a Board-defined
minimum, ensuring liquidity through highly marketable investments and close asset–liability
matching.
A liquidity risk policy is in place and compliance with the policy is monitored and reported to
the Risk and Capital Committee (‘R&CC’) and Finance Sub Committee (‘FSC’). There have
been no significant changes in exposure or management approach from the prior year.
i.
Management of Liquidity Risk
The Syndicate manages liquidity risk by ensuring it can meet liabilities under normal and
stressed conditions. Key measures include:
x
Regular cash flow forecasting;
x
Matching asset durations to expected insurance outflows;
x
Investing in marketable assets;
x
Holding sufficient cash and liquid assets for daily needs;
x
Maintaining and updating contingency funding plans.
ii.
Maturity analysis of Syndicate Liabilities
The maturity analysis presented in the table below shows the remaining contractual maturities
for the Syndicate’s insurance contracts and financial instruments. For insurance and
reinsurance contracts, the contractual maturity is the estimated date when the gross
undiscounted contractually required cash flows will occur. For financial liabilities, it is the
earliest date on which the gross undiscounted cash flows (including contractual interest
payments) could be paid assuming conditions are consistent with those at the reporting date.
Past due but not impaired
0-3 months
past due
3-6
months
past due
6-12
months
past due
Greater than
1 year past
due
Total
2024
£000
£000
£000
£000
£000
Debtors arising out of direct insurance
operations
Debtors arising out of reinsurance operations
Other debtors
Total
Notes to the Financial Statements (continued)
31 December 2025
31
4.
Risk and Capital Management (continued)
Financial Risk (continued)
b)
Liquidity Risk (continued)
ii. Maturity analysis of Syndicate Liabilities (Continued)
The table below summarises the maturity profile of the Syndicate’s insurance contracts and
financial liabilities.
c)
Market Risk
Market risk is the potential for losses or adverse changes in the financial situation of the
business, resulting directly or indirectly from fluctuation in the level and/or volatility of market
prices of assets, liabilities and financial instruments. The risk includes interest rate, spread and
currency risks.
i.
Management of Market Risks
The Syndicate has controls in place to manage each major market risk. Investment guidelines
and mandates are in place that must be adhered to. There is an embedded asset liability
matching process in place that is overseen by the nominated Asset Liability Officer for MRSL,
in conjunction with MRAG Risk and Investment functions in Munich.
Currency risk is an exposure of MRSL which is the risk of value changes due to exchange rate
movements. The Syndicate, with GBP as its functional currency, is mainly exposed to USD. It
manages this by matching foreign currency liabilities with assets in the same currency.
Undiscounted net cash flows
Year 2025
No
maturity
stated
0-1 yrs
1-3 yrs
3-5 yrs
>5 yrs
Total
£000
£000
£000
£000
£000
£000
Claims outstanding
Deposits received from
reinsurers
Creditors
Other technical provisions
Total
Undiscounted net cash flows
Year 2024
No
maturity
stated
0-1 yrs
1-3 yrs
3-5 yrs
>5 yrs
Total
£000
£000
£000
£000
£000
£000
Claims outstanding
Deposits received from
reinsurers
Creditors
Other technical provisions
Total
Notes to the Financial Statements (continued)
31 December 2025
32
4. Risk and Capital Management (continued)
Financial Risk (continued)
c)
Market Risk (continued)
i.
Management of Market Risks (Continued)
The table below summarises the exposure of the total assets and liabilities to foreign currency
exchange risk at the reporting date, as follows:
Sterling
US dollar
Euro
Canadian
dollar
Australian
dollar
Japanese
Yen
Other
Total
2025
£000
£000
£000
£000
£000
£000
£000
£000
Investments
Reinsurers' share
of technical
provisions
Debtors
Other assets
Prepayments and
accrued income
(204,792 )
(3,747 )
Total assets
Technical
provisions
(423,637 )
(1,643,460 )
(196,947 )
(108,957 )
(2,373,001 )
Creditors
(321,391 )
(287,499 )
(11,992 )
(3,335 )
(624,217 )
Accruals and
deferred income
(211 )
(3,939 )
(178 )
(17 )
(4,345 )
Total liabilities
(745,239 )
(1,934,898 )
(209,117 )
(112,309 )
(3,001,563 )
Total Capital and
reserves
(434,792 )
(47,224 )
(27,451 )
(18,594 )
(22,746 )
(480,790 )
Sterling
US dollar
Euro
Canadian
dollar
Australian
dollar
Japanese
Yen
Other
Total
2024
£000
£000
£000
£000
£000
£000
£000
£000
Investments
Reinsurers' share
of technical
provisions
Debtors
Other assets
Prepayments and
accrued income
(56,823 )
(312 )
(24,123 )
Total assets
Technical
provisions
(387,778 )
(1,630,498 )
(165,156 )
(103,031 )
(2,286,463 )
Creditors
(223,822 )
(137,392 )
(13,932 )
(4,975 )
(380,121 )
Accruals and
deferred income
(100 )
(2,070 )
(112 )
(4 )
(2,286 )
Total liabilities
(611,700 )
(1,769,960 )
(179,200 )
(108,010 )
(2,668,870 )
Total Capital and
reserves
(406,248 )
(43,162 )
(40,396 )
(12,938 )
(22,456 )
(514,315 )
Notes to the Financial Statements (continued)
31 December 2025
33
4. Risk and Capital Management (continued)
Financial Risk (continued)
c) Market Risk (continued)
ii. Sensitivity Analysis to Market Risks
The sensitivity analysis below shows the impact of a 50 basis point movement in interest rates
with all other variables held constant, showing the impact on the result before tax due to
changes in fair value of financial assets and liabilities (whose fair values are recorded in the
profit or loss account).
The impact of the reasonably possible changes in the interest rate on Members’ balances
would be the same, since the Syndicate recognises all changes in recognised assets and
liabilities in profit or loss.
The currency analysis below shows the impact on the Syndicate’s net assets of a 10%
appreciation or depreciation in all non-Sterling currencies relative to Sterling, at the balance
sheet date.
Group Risk
Group risk is the potential of risk events, of any nature, arising in or from membership of a
corporate group. As part of MRSG, the Syndicate benefits from group support while
maintaining independence as a Lloyd’s-regulated entity with its own Board and governance. It
aligns on risk management with Munich Re Group’s Integrated Risk Management and receives
underwriting, reinsurance, and asset management support from MRCL, Munich Ergo Asset
Management GmbH (‘MEAG’), and the Group Investment function of Münchener
Rückversicherungs-Gesellschaft Aktiengesellschaft (‘Munich Re’).
2025
2025
2024
2024
Impact on
results before
tax
Impact on
members’
balances
Impact on
results
before tax
Impact on
members’
balances
£000
£000
£000
£000
Interest rate risk
+ 50 basis points shift in yield curves
(17,700 )
(17,700 )
(13,800 )
(13,800 )
- 50 basis points shift in yield curves
2025
2025
2024
2024
Impact on
results before
tax
Impact on
members’
balances
Impact on
results
before tax
Impact on
members’
balances
£000
£000
£000
£000
currency risk
10% appreciation
24,325
24,325
52,520
52,520
10% depreciation
(24.325)
(24,325)
(52,520)
(52,520)
Notes to the Financial Statements (continued)
31 December 2025
34
4. Risk and Capital Management (continued)
Group Risk (continued)
Management of Group Risks
There are a range of governance and monitoring controls in place to appropriately manage
group risk including the annual Board and Committee effectiveness review, an embedded
annual fit and proper process and service level agreement monitoring with MRSG UK Services
Limited (‘MRSGUKS’).
Operational Risk
MRSL is exposed to operational risk which may result in losses to the business due to factors
such as inadequate systems, management failure, inadequate controls, fraud or human error.
Key MRSL operational risks include data, people, IT, operational recovery (including business
continuity, disaster recovery and operational resilience) and third-party risk management.
Management of Operational Risks
This risk is mitigated through the internal control framework which proactively address the risks
associated with MRSL’s business processes, systems and other resources that might
otherwise be detrimental to the overall performance of the Syndicate.
Legal, Regulatory and Compliance Risk
Regulatory risk is the risk of loss owing to a breach of regulatory requirements or failure to
respond to regulatory change. The company is required to comply with the requirements of
the Financial Conduct Authority (‘FCA’), Prudential Regulation Authority (‘PRA’) and the
Society of Lloyd’s (‘Lloyd’s’). Lloyd’s requirements include those imposed on the Lloyd’s
market by overseas regulators.
Management of Legal, Regulatory and Compliance Risk
This risk is mitigated through appropriate control procedures across key areas of regulatory
risk including conduct risk (including consumer duty), financial crime and general compliance
advisory areas. As part of the MRSL governance structure there is a Head of Compliance
(SMF16) that manages the compliance function that monitors business activity and regulatory
developments to assess any effects on the company.
Strategic Risk
Strategic risk is the risk of losses or missed opportunities arising from inadequate business
strategy and objectives, incorrect business decisions, implementing decisions poorly, or being
unable to adapt on a timely basis to external threats, opportunities and developments.
Management of Strategic Risk
There are a range of controls in place to support the management of strategic risk including
strategy days, second line reviews of the business plan, setting and monitoring of strategic
Key Performance Indicators (both financial and non-financial) and regular Board monitoring of
strategy execution and performance. Key processes including the new product process have
been designed to support strategic execution.
Notes to the Financial Statements (continued)
31 December 2025
35
4. Risk and Capital Management (continued)
Strategic Risk (continued)
Management of Strategic Risk (continued)
Management of strategic risk is challenging driven by elevated levels of geopolitical
uncertainty, global economic volatility and softening market conditions. To support this, MRSL
utilises forward-looking analysis and scenarios. Another area of development relates to the
Lloyd’s Principles-Based Oversight for the Capital Principle, where there is a cross-functional
effort across MRSL.
Geopolitical tensions are closely monitored by MRSL, in addition to the monitoring the
individual risk categories outlined above, MRSL has in place an emerging risk process to
review risks that may impact the business in the future, and to ensure that any such risks are
understood and mitigated where possible.
Other Key Enterprise Risks
Environmental, Social and Governance (‘ESG’) considerations
MRSL is aligned with Munich Re Group ESG policies and initiatives with respect to its
insurance business, investment activities and business operations. In addition, the Munich Re
Code of Conduct lays out the Group’s commitment to sustainability and human rights, in
alignment with the principles of the UN Global Compact.
MRSL has aligned with the MRSG ESG Strategy since 2023. Led by MRSG’S Head of ESG
and an ESG governance forum, the strategy integrates sustainability across business
operations and adapts to emerging risks and opportunities. ESG is a frequent item on Board
and Committee meetings.
i.
Climate Change Related Risk
The Managing Agent and Syndicate monitor climate regulations including the Lloyd’s
Transition Roadmap 2.0. A cross-functional team leads stress testing, investment reviews, and
litigation risk analysis, overseen by the CUO with updates to the R&CC and Board.
In April 2025, the PRA issued Consultation Paper CP10/25, proposing revisions to its
supervisory expectations for managing climate-related financial risks. In December 2025 the
PRA subsequently issued PS25/25 containing the final policy with Supervisory Statement
SS5/25 (which was an update to previous SS3/19), enhancing requirements for governance,
risk management, scenario analysis, and integration of climate risks into firms’ capital and
liquidity assessments.
The proposed updates emphasise board accountability, clearer linkage between climate risk
management and business strategy, and more rigorous use of climate scenario analysis in
decision-making. The Group continues to monitor these developments and will assess any
changes needed to ensure ongoing compliance with the finalised supervisory statement once
implemented.
Notes to the Financial Statements (continued)
31 December 2025
36
4. Risk and Capital Management (continued)
Other Key Enterprise Risks (continued)
Environmental, Social and Governance (‘ESG’) considerations (continued)
ii. Culture including Diversity, Equity & Inclusion (‘DEI’)
Culture, including DEI, continues to feature high on the agenda of boards and regulators.
MRSL, as part of MRSG and the wider network of Munich Re entities in the United Kingdom
and Ireland region (‘UK&I’), is active in its response to the challenges of “culture” related topics.
Since launching its DEI strategy in 2023, MRSL focuses on inclusive recruitment, sponsorship,
and learning, supported by leadership, a DEI steering committee, and data-driven initiatives
like training and awareness events. The Board views DEI as vital to an ethical, successful
business.
Inflation
Inflation affects claims, reserving, pricing, investments, and capital. MRSL manages this
through regular monitoring across functions, led by the Actuarial Function and Inflation Review
Group comprising actuarial, underwriting exposure management and claims representatives.
Assumptions are reviewed using internal models, benchmarks, and governance reporting.
Reserving and pricing reflect inflation sensitivity, particularly for exposed classes, while
investment and capital models are updated regularly with oversight from relevant committees.
Information Security Risk including Cyber Risk
Cyber risk continues to rise as cyber-criminals target business vulnerabilities. Munich Re
maintains a secure platform with evolving controls to counter threats like phishing,
ransomware, and fraud. Measures include security standards, third-party risk assessments,
staff training, awareness campaigns, and phishing reporting tools.
Artificial Intelligence (‘AI’)
Munich Re and MRSG commit to responsible AI use to improve service and operations while
managing risks like bias and data security. A Group-wide AI Governance Directive defines
roles and compliance, with oversight from MRSG Risk Management and the AI & Ethics
manager.
Capital Management
a) Capital Framework at Lloyd’s
Lloyd’s is regulated by the PRA under Solvency UK, with capital requirements applied at the
member and central level, not the Syndicate level. As a result, the Syndicate’s capital
requirement is not disclosed in these financial statements.
b) Lloyd’s Capital Setting Process and Provision of Capital by Members
Each syndicate must calculate its Solvency Capital Requirement (‘SCR’) to cover a 1-in-200
year loss, both to ultimate and over a one-year horizon. These are reviewed and approved by
Lloyd’s.
Notes to the Financial Statements (continued)
31 December 2025
37
4. Risk and Capital Management (continued)
Capital Management (continued)
b)
Lloyd’s Capital Setting Process and Provision of Capital by Members (continued)
Lloyd’s also applies a capital uplift, the Economic Capital Assessment (‘ECA’), to support its
financial strength and ratings. For 2025, the uplift is 35% (2024: 35%) of the member’s SCR
to ultimate.
Members meet their ECA through Funds at Lloyd’s (‘FAL’), Funds in Syndicate (‘FIS’), or their
share of members’ balances.
All Syndicate assets less liabilities (as shown in members’
balances) are available to meet capital requirements.
Capital is allocated based on risk appetite and expected returns, with ongoing review to ensure
compliance. The Syndicate met all capital requirements for the period ended 31 December
2025.
5.
Analysis of Underwriting Result
An analysis of the underwriting result before investment return is set out below:
2025
Gross
premiums
written
Gross
premiums
earned
Gross
claims
incurred
Gross
operating
expenses
Reinsurance
balance
£000
Underwriting
result
£000
£000
£000
£000
£000
Direct insurance
Accident & Health
(329 )
(191 )
(16 )
Motor (third party
liability)
(1,030 )
(599 )
(51 )
Motor (other classes)
(730 )
(424 )
(36 )
Marine, Energy,
Aviation and Transport
(137,180 )
(79,694 )
(6,795 )
Fire and Other Damage
to Property
(267,882 )
(155,624 )
(13,269 )
Third party liability
(96,171 )
(55,870 )
(4,764 )
Credit and suretyship
(4,659 )
(2,706 )
(231 )
Miscellaneous
(24,807 )
(14,410 )
(1,229 )
Total direct insurance
(532,788 )
(309,518 )
(26,391 )
Reinsurance
acceptances
(110,791 )
(64,363 )
(5,489 )
Total
(643,579 )
(373,881 )
(31,880 )
The below facilitates the classification of the above segments into the Lloyd’s aggregate
classes of business:
Notes to the Financial Statements (continued)
31 December 2025
38
5.
Analysis of Underwriting Result (continued)
The below facilitates the classification of the above segments into the Lloyd’s aggregate
classes of business:
2024
Gross
premiums
written
Gross
premiums
earned
Gross
claims
incurred
Gross
operating
expenses
Reinsurance
balance
Underwriting
result
£000
£000
£000
£000
£000
£000
Additional analysis
Fire and damage to
property of which is:
Specialities
(208,626 )
(165,269 )
(45,259 )
Energy
(18,036 )
(9,158 )
Third party liability of
which is:
Energy
2025
Gross
premiums
written
Gross
premiums
earned
Gross
claims
incurred
Gross
operating
expenses
Reinsurance
balance
Underwriting
result
£000
£000
£000
£000
£000
£000
Additional analysis
Fire and damage to
property of which is:
Specialities
(5,502 )
(6,261 )
(854 )
Energy
Third party liability of
which is:
Energy
2024
Gross
premiums
written
Gross
premiums
earned
Gross
claims
incurred
Gross
operating
expenses
Reinsurance
balance
Underwriting
result
£000
£000
£000
£000
£000
£000
Direct insurance
Accident & Health
(465 )
(781 )
(224 )
Motor (other classes)
(2,718 )
(1,280 )
(3 )
(353 )
Marine, Energy, Aviation
and Transport
(165,754 )
(90,425 )
Fire and Other Damage
to Property
(199,748 )
(165,269 )
(63,295 )
Third party liability
(105,518 )
(58,434 )
(13,744 )
Miscellaneous
(37,529 )
(25,020 )
(7,633 )
Total direct insurance
(511,732 )
(341,209 )
(83,186 )
Reinsurance
acceptances
(172,558 )
(46,247 )
Total
(684,290 )
(387,456 )
(39,913 )
Notes to the Financial Statements (continued)
31 December 2025
39
5. Analysis of Underwriting Result (continued)
All premiums are written through the Lloyd’s platform.
Brokerage and commission on direct business written was £281.7m (2024: £283.8m).
No gains or losses were recognised in profit or loss during the year on buying reinsurance
(2024: £nil).
The gross premiums written for direct insurance by underwriting location of risk is presented
in the table below:
2025
2024
£000
£000
United Kingdom
Total gross premiums written
6. Net Operating Expenses
2025
2024
£000
£000
Acquisition costs
Change in deferred acquisition costs
(7,664 )
(33,716 )
Administrative expenses
Members’ standard personal expenses
Reinsurance commissions and profit participation
(4,969 )
(3,363 )
Net operating expenses
Total commissions for direct insurance business for the year amounted to:
2025
2024
£000
£000
Total commission for direct insurance business
Administrative expenses include:
2025
2024
£000
£000
Auditors’ remuneration:
578
451
fees payable to the Syndicate’s auditor for the audit of these financial
statements
fees payable to the Syndicate’s auditor and its associates in respect of other
services pursuant to legislation
Impairment losses on debtors:
-
-
arising out of direct insurance operations
arising out of reinsurance operations
Notes to the Financial Statements (continued)
31 December 2025
40
7. Key Management Personnel Compensation
The Directors of Munich Re Syndicate Limited received the following aggregate remuneration
charged to the Syndicate:
2025
2024
£000
£000
Directors’ emoluments
Fees
The active underwriter received the following remuneration charged as a Syndicate expense
and included within the Directors’ emoluments above:
2025
2024
£000
£000
Emoluments
8. Staff Numbers and Costs
All employees are employed by the Service Company. The Syndicate and Managing Agent
have no employees. The average number of employees employed by the Service Company
but working for the Syndicate during the year was as follows:
Number of employees
2025
2024
Administration and finance
Underwriting
Claims
Total
The following amounts were recharged to the Syndicate by the Service Company in respect
of salary costs:
2025
2024
£000
£000
Wages and salaries
Social security costs
Other pension costs
Total
Notes to the Financial Statements (continued)
31 December 2025
41
9. Investment Return
2025
2024
£000
£000
Interest and similar income
From financial instruments designated at fair value through profit or loss
Interest and similar income
Interest on cash at bank
Other income from investments
From financial instruments designated at fair value through profit or loss
Gains on the realisation of investments
Losses on the realisation of investments
(275 )
(127 )
Unrealised gains on investments
Unrealised losses on investments
(2,730 )
(3,778 )
Investment management expenses
(1,634 )
(1,056 )
Total investment return
Transferred to the technical account from the non-technical account
Investment return on Funds in Syndicate
Investment return not affiliated to the FIS was wholly allocated to the technical account.
10. Distribution
The gross distribution payable to the member was £226.0m (2024: payable of £122.1m).
11. Financial Investments
Carrying value
Cost
2025
2024
2025
2024
£000
£000
£000
£000
Debt securities and other fixed income
securities
Syndicate loans to central fund
Loans and deposits with credit
institutions
Total financial investments
Included within the fair value of financial investments is accrued income of £23.5m (2024:
£14.3m).
Loans and deposits with credit institutions include overseas deposits totalling £62.9m (2024:
£55.2m), which are held at fair value. Of this, £11.5m (2024: £13.6m) represent short-term
deposits and are presented under Cash and cash equivalents in Note 22.
Notes to the Financial Statements (continued)
31 December 2025
42
11. Financial Investments (continued)
Included in the carrying values above are listed investments as follows:
2025
2024
£000
£000
Listed investments
The table below presents an analysis of financial investments by their measurement
classification.
2025
2024
£000
£000
Financial assets measured at fair value through
profit or loss
Total financial investments
As the Syndicate is fully aligned, the Syndicate holds the capital supporting its underwriting in
its Syndicate’s premium trust funds. These funds are known as FIS. At 31 December 2025 the
following amount was held as FIS:
2025
2024
£000
£000
Funds in Syndicate
Total funds in syndicate
Valuation Hierarchy
The Syndicate classifies its financial instruments held at fair value in its Balance Sheet using
a fair value hierarchy based on the inputs used in the valuation techniques as follows:
x
Level 1
– financial assets that are measured by reference to published quotes in an
active market. A financial instrument is regarded as quoted in an active market if quoted
prices are readily and regularly available from an exchange, dealer, broker, industry
group, pricing service or regulatory agency and those prices represent actual and
regularly occurring market transactions on an arm’s length basis.
x
Level 2 –
financial assets measured using a valuation technique based on
assumptions that are supported by prices from observable current market transactions.
For example, assets for which pricing is obtained via pricing services but where prices
have not been determined in an active market, financial assets with fair values based
on broker quotes, investments in private equity funds with fair values obtained via fund
managers and assets that are valued using the Syndicate’s own models whereby the
significant inputs into the assumptions are market observable.
Notes to the Financial Statements (continued)
31 December 2025
43
11. Financial Investments (continued)
x
Level 3 –
financial assets measured using a valuation technique (model) based on
assumptions that are neither supported by prices from observable current market
transactions in the same instrument nor are they based on available market data.
Therefore, unobservable inputs reflect the Syndicate's own assumptions about the
assumptions that market participants would use in pricing the asset or liability (including
assumptions about risk). These inputs are developed based on the best information
available, which might include the Syndicate’s own data.
No further Level 3 disclosure is provided on the grounds of materiality.
The table below analyses financial instruments held at fair value in the Syndicate’s Balance
Sheet at the reporting date by its level in the fair value hierarchy.
2025
Level 1
Level 2
Level 3
Total
£000
£000
£000
£000
Debt securities and other fixed income
securities
Syndicate loans to central fund
Loans and deposits with credit institutions
Total financial investments
2024
Level 1
Level 2
Level 3
Total
£000
£000
£000
£000
Debt securities and other fixed income
securities
Syndicate loans to central fund
Loans and deposits with credit institutions
Total financial investments
Information on the methods and assumptions used to determine fair values for each major
category of financial instrument measured at fair value is provided below.
Debt securities are generally valued using composite prices from external pricing vendors,
who consolidate recent trade data for identical or similar securities and may adjust for timing
or use models if trades are lacking.
Corporate bonds and asset-backed securities traded over the counter are mainly valued using
composite prices. Where prices are based on multiple quotes and those quotes are based on
actual recent transactions in the same instrument the securities are classified as level 2,
otherwise they are classified as level 3 in the fair value hierarchy.
GIM reviews vendor prices for reasonableness by comparing with similar transactions,
analysing pricing trends, and considering market events. At the reporting date, Level 1 and
Level 2 assets and liabilities were valued using observable market data, while Level 3
investments relied on unobservable inputs in valuation models.
Notes to the Financial Statements (continued)
31 December 2025
44
11. Financial Investments (continued)
Investments
GIM mandates MEAG, Munich Re Group’s in-house asset manager, to manage the majority
of Syndicate funds using an Asset-Liability Matching approach based on underwriting profiles.
In October 2024, Aberdeen Ltd. was appointed to manage the Pound Sterling (GBP) Credit
portfolio. In 2025, most assets were actively managed against defined benchmarks tailored to
each trust fund, covering money market instruments, government bonds, credit, and agencies
across EUR, GBP, USD, and CAD portfolios.
Period-end portfolio duration was 1.63 (2024: 1.71). Board-set limits apply to sectors, issuers,
and minimum credit ratings for all portfolios.
Investment Performance
The 2025 calendar year investment performance was as follows:
2025
2025
2024
2024
Currency
Fund
Return
Benchmark
return
Fund
Return
Benchmark
Return
%
%
%
%
US dollars
5.62
5.39
4.31
-
Canadian dollars
3.41
-
4.87
-
Sterling (Government)
5.39
4.82
2.78
-
Sterling (Credit buy-and-maintain)
5.84
-
3.40
-
Euros
2.37
1.77
3.15
2.84
Combined investment performance of managed
portfolio
5.09
4.05
12. Debtors Arising out of Direct Insurance Operations
2025
2024
£000
£000
Due within one year
Due after one year
Total
13. Debtors Arising out of Reinsurance Operations
2025
2024
£000
£000
Due within one year
Due after one year
Total
Notes to the Financial Statements (continued)
31 December 2025
45
14. Other Debtors
2025
2024
£000
£000
Other related party balances (non-syndicate)
Amounts due from members
Other
Total
15. Deferred Acquisition Costs
The table below shows changes in deferred acquisition costs assets from the beginning of the
period to the end of the period.
2025
2024
Gross
Reinsurance
Net
Gross
Reinsurance
Net
£000
£000
£000
£000
£000
£000
Balance at 1
January
(2,286 )
(2,164 )
Incurred deferred
acquisition costs
(4,969 )
(3,363 )
Amortised deferred
acquisition costs
(314,837 )
(312,063 )
(330,987 )
(327,720 )
Foreign exchange
movements
(7,473 )
(7,337 )
(451 )
(26 )
(477 )
Balance at 31
December
(4,345 )
(2,286 )
16. Claims Development
The following tables illustrate the development of the estimates of earned ultimate cumulative
claims incurred, including claims notified and IBNR, for each successive underwriting year,
illustrating how amounts estimated have changed from the first estimates made.
As these tables are on an underwriting year basis, there is an apparent large increase from
amounts reported for the end of the underwriting year to one year later as a large proportion
of premiums are earned in the year of account’s second year of development.
Balances have been translated at exchange rates prevailing at 31 December 2025 in all cases.
Notes to the Financial Statements (continued)
31 December 2025
46
16. Claims Development (continued)
Gross:
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
Total
Pure underwriting year
£000
£000
£000
£000
£000
£000
£000
£000
£000
£000
£000
Estimate of gross claims
At end of underwriting year
One year later
Two years later
Three years later
Four years later
Five years later
Six years later
Seven years later
Eight years later
Nine years later
Estimate of gross claims
reserve
Provision in respect of prior
years
Less gross claims paid
(189,293 )
(213,134 )
(315,149 )
(397,008 )
(337,447 )
(376,358 )
(344,208 )
(267,042 )
(163,361 )
(39,101 )
(2,642,101 )
Gross claims reserve
Notes to the Financial Statements (continued)
31 December 2025
47
16. Claims Development (continued)
Net:
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
Total
Pure underwriting year
£000
£000
£000
£000
£000
£000
£000
£000
£000
£000
£000
Estimate of net claims
At end of underwriting year
One year later
Two years later
Three years later
Four years later
Five years later
Six years later
Seven years later
Eight years later
Nine years later
Estimate of net claims reserve
Provision in respect of prior years
Less net claims paid
(148,070 )
(147,904 )
(226,943 )
(232,726 )
(267,204 )
(306,279 )
(298,425 )
(255,785 )
(153,508 )
(35,794 )
(2,072,638 )
Net claims reserve
(4,831 )
Notes to the Financial Statements (continued)
31 December 2025
48
17. 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
Reinsurance
assets
Net
Gross
provisions
Reinsurance
assets
Net
£000
£000
£000
£000
£000
£000
Claims outstanding
Balance at 1 January
(332,024 )
(274,195 )
Claims paid during the year
(482,450 )
(437,992 )
(440,601 )
(369,946 )
Expected cost of current
year claims
(55,298 )
(97,356 )
Change in estimates of
prior year provisions
(95,957 )
(28,985 )
Foreign exchange
movements
(71,124 )
(53,492 )
(2,143 )
Balance at 31 December
(421,189 )
(332,024 )
2025
2024
Gross
provisions
Reinsurance
assets
Net
Gross
provisions
Reinsurance
assets
Net
£000
£000
£000
£000
£000
£000
Unearned premiums
Balance at 1 January
(51,700 )
(42,906 )
Premiums written during
the year
(204,423 )
(175,530 )
Premiums earned during
the year
(1,168,495 )
(985,360 )
(1,254,315 )
(1,088,061 )
Foreign exchange
movements
(32,560 )
(28,250 )
(854 )
(372 )
Balance at 31 December
(68,678 )
(51,700 )
Refer to Note 4 for the sensitivity analysis performed over the value of insurance liabilities,
disclosed in the accounts, to potential movements in the assumptions applied within the
technical provisions.
18. Discounted Claims
No claims provisions are discounted.
Notes to the Financial Statements (continued)
31 December 2025
49
19. Creditors Arising out of Direct Insurance Operations
2025
2024
£000
£000
Due within one year
Due after one year
Total
20. Creditors Arising out of Reinsurance Operations
2025
2024
£000
£000
Due within one year
Due after one year
Total
21. Other Creditors
2025
2024
£000
£000
Other related party balances (non-syndicates)
Other liabilities
Total
22. Cash and Cash Equivalents
2025
2024
£000
£000
Cash at bank and in hand
Deposits with credit institutions
Total cash and cash equivalents
Only Financial Investments comprising of call deposits with maturities of three months or less
from the acquisition date that are used by the Syndicate in the management of its short-term
commitments are included in cash and cash equivalents.
Deposits with credit institutions comprise of overseas deposits classified as cash and cash
equivalents.
Included within cash and cash equivalents are the following amounts which are not available
for use by the Syndicate because they are held in regulated bank accounts:
2025
2024
£000
£000
Cash at bank and in hand
Total cash and cash equivalents not available for use by the syndicate
Notes to the Financial Statements (continued)
31 December 2025
50
23. Analysis of Net Debt
At 1 January
Cash flows
Acquired
Fair value
and
exchange
movements
Non-cash
changes
At 31
December
2025
2025
Cash and cash
equivalents
(7,031 )
(5,807 )
Total
(7,031 )
(5,807 )
24
.
Related Parties
These disclosure requirements are in addition to the requirement to disclose key management
personnel compensation. This disclosure is given in note 7.
Munich Ergo Asset Management GmbH (‘MEAG’)
MEAG is Munich Re’s asset management company. The Syndicate paid a total of £1.5m
(2024: £1.1m) for asset management and accounting services in 2025.
There were no
outstanding balances with the Syndicate at the year-end (2024: £nil).
Munich Re Capital Limited (‘MRCL’)
MRCL is the corporate member of the Syndicate. MRCL’s immediate parent company is
MRSG. Apart from members balances, there were no outstanding balances with the Syndicate
at the year-end.
T E Artmann, D J R Hoare and G K Hill are directors of MRCL.
Munich Re Risk Solutions Ireland Limited (‘MRRSI’)
MRRSI is a wholly owned subsidiary of MRSG which was set up for the Syndicate to enable
it to have continued access to EEA business via the Lloyd’s Europe platform following Brexit.
As of 31 December 2025, MRRSI has written £3.8m of reinsurance contracts (2024: £2.3m).
There were no outstanding balances with the Syndicate at the year-end.
There were no directors in common between the Managing Agent and MRRSI for 2025.
Munich Re Specialty Group N.A Inc. (‘MRSGNA’)
MRSGNA is a directly wholly owned company by MRSG and produces Marine and Cyber
business from the USA for the Syndicate under a binding authority. Business produced by
MRSGNA amounts to approximately 5.1% (2024: 7.3%) of the estimated earned premium
(gross of reinsurance) of the Syndicate in 2025. At year-end the outstanding net balance due
to the Syndicate was £11.4m (2024: £nil).
T E Artmann was a director of MRSGNA until 2 December 2025.
Munich Re Specialty Insurance (UK) Limited (‘MRSI’)
MRSI is an IDC, wholly owned by MRSG and predominantly produces UK provincial Marine
and Property business for the Syndicate under a binding authority.
Notes to the Financial Statements (continued)
31 December 2025
51
24. Related Parties (continued)
Munich Re Specialty Insurance (UK) Limited (‘MRSI’) (continued)
On December 31, 2011, the Syndicate issued a subordinated loan of £0.2m to MRSI. In
January 2022, a £0.7m subordinated loan previously provided to GJW was transferred to
MRSI to ensure regulatory compliance. The loan accrues interest at the Secured Overnight
Financing Rate (SOFR) plus 1% and is repayable no earlier than two years from issuance or
upon written notification from the borrower to both the Lender and the FCA. As of year-end,
the net outstanding balance was £0.3m due to the Syndicate (2024: £5.0m due to the
Syndicate).
T E Artmann was a director of MRSI until 31 December 2025.
Munich Re Syndicate Limited (‘MRSL’)
During the year, the Syndicate has paid fees to MRSL, the Managing Agent of the Syndicate,
amounting to £3.0m (2024: £2.3m). MRSL’s immediate parent company is MRSG. The
outstanding net balance at year-end was £377.9m due from the Syndicate (2024: £158.8m
due from the Syndicate).
The Managing Agent has paid £64.9m (2024: £63.0m) in shared service recharges for the
ordinary day to day running costs related to the Syndicate.
Munich Re Syndicate Labuan Limited (‘MRSLAB’)
MRSLAB is a non-profit making IDC owned by MRSG and produces Specialty business from
Malaysia exclusively for the Syndicate under a binding authority. Business produced by
MRSLAB amounts to approximately 0.2% (2024: 0.4%) of the estimated earned premium
(gross of reinsurance) of the Syndicate in 2025. The outstanding net balance at year-end was
£0.2m due from the Syndicate (2024: £0.2m due to the Syndicate).
There were no directors in common between the Managing Agent and MRSLAB for 2025.
Munich Re Syndicate Singapore Pte Limited (‘MRSS’)
MRSS is a non-profit making IDC owned by MRSG and predominantly produces Marine and
Green Solutions business from S.E. Asia exclusively for the Syndicate under a binding
authority. Business produced by MRSS amounts to approximately 4.6% (2024: 4.2%) of the
estimated earned premium (gross of reinsurance) of the Syndicate in 2025. The outstanding
net balance at the year-end was £2.9m due to the Syndicate (2024: £3.1m due to the
Syndicate).
T E Artmann is a director of MRSS.
Münchener Rückversicherungs–Gesellschaft Aktiengesellschaft in München (‘Munich
Re’)
Munich Re Syndicate Limited is wholly owned by MRSG, which is wholly owned by Munich
Re. The Syndicate placed a total of £24.7m (2024: £17.9m) outwards reinsurance premium
with its ultimate parent undertaking under 30 different contracts for the 2025 year of account
(2024: 35). These contracts provided the Syndicate with cover according to terms in the
normal course of business.
Notes to the Financial Statements (continued)
31 December 2025
52
24. Related Parties (continued)
Münchener Rückversicherungs–Gesellschaft Aktiengesellschaft in München (‘Munich
Re’) (continued)
There were no outstanding balances with the Syndicate at the year-end (2024: £nil).
MRSG UK Services Limited (’MRSGUKS’)
MRSGUKS is a wholly owned subsidiary of MRSG, which is the sole employer within the UK
subgroup. There were no outstanding balances with the Syndicate at the year-end.
T E Artmann and G K Hill are directors of MRSGUKS.
Roanoke International Brokers Limited (‘RIBL’)
RIBL is an insurance broker wholly owned by MRSG. RIBL conducts business both with the
Syndicate and third parties. The gross brokerage income generated by RIBL in the year ended
31 December 2025 was £3.0m (2024: £6.0m). A high percentage of this brokerage is from the
placement of business through IDCs. There were no outstanding balances with the Syndicate
at the year-end.
There were no directors in common between the Managing Agent and RIBL for 2025.
Roanoke International Brokers (MENA) Limited (‘RIBML’)
RIBML is an insurance broker in the Middle East which is wholly owned by MRSG. Business
produced by RIBML amounts to approximately 0.0% (2024: 0.0%) of the estimated earned
premium (gross of reinsurance) of the Syndicate in 2025 where the gross brokerage income
generated by RIBML in the year ended 31 December 2025 was £1.4m (2024: £2.0m). The
outstanding net balance at year-end with the Syndicate was £nil (2024: £nil).
There were no directors in common between the Managing Agent and RIBML for 2025.
25. Off-Balance Sheet Items
There are no off-Balance Sheet items for the Syndicate.
26.
Post Balance Sheet Events
A cash distribution of £226.0m to members will be proposed in relation to the 2023 year of
account (2024: £122.1m distribution in relation to the 2022 year of account).
27. Contingencies and Commitments
Syndicate 0457 does not have any contingent liabilities or commitments.
Notes to the Financial Statements (continued)
31 December 2025
53
28.
Foreign Exchange Rates
The following foreign currency exchange rates have been used for principal foreign currency
transactions:
2025
2024
Start-of-
period
Year-end
Average
Start-of-
period
Year-end
Average
rate
rate
rate
rate
rate
rate
Sterling
Euro
US dollar
Canadian dollar
Australian dollar
Japanese Yen
29. Funds at Lloyds (‘FAL’)
Every member is required to hold capital at Lloyd’s, which is held in trust and known as FAL.
These assets are in the form of letters of credit from Munich Re. 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 PRA requirements and resource criteria. FAL is determined by a number of factors
including the nature and amount of risk in respect of business that has been 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 members’ FAL to meet liquidity requirements or
to settle losses.