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Annual Report and Accounts
2025
Hiscox Syndicate
1
Directors and administration –
Hiscox Syndicate 3624
2
Report of the Directors of the
managing agent
6
Statement of managing
agent’s responsibilities
7
Independent auditors’ report
10
Profit and loss account:
technical account
– general business
11
Profit and loss account:
non-technical account
– general business
12
Balance sheet – assets
13
Balance sheet – liabilities
14
Statement of changes in
members’ balances
15
Statement of cash flows
16
Notes to the accounts
Directors and administration
Hiscox Syndicate 3624
Managing agent:
Managing agent
composite Syndicate 0033, aligned Syndicate 3624 and Special
Purpose Arrangement (SPA) 6104. HSL is an indirectly wholly
owned subsidiary of Hiscox Ltd.
Directors
M B Boucher – Non Executive (appointed 1 January 2025)
A P Dolphin
H Hanna – (appointed 13 November 2025)
T W Harris – Non Executive
T C Huerlimann – Non Executive Chair
H A Hussain
J L T Illingworth – Non Executive
S E Kemble
P A Lawrence
K J M Markham
J R Musselle
H Rose - (resigned 22 January 2026)
D S Saker - (appointed 22 January 2026)
Managing agent’s registered office
22 Bishopsgate
London
EC2N 4BQ
United Kingdom
Managing agent’s company number
02590623
Syndicate 3624:
Active underwriter
S E Kemble
Bankers
Lloyds Bank plc
Citibank
Royal Bank of Canada
Goldman Sachs
Investment managers
Payden & Rygel Global Limited
Fiera Capital Corporation
Independent registered auditors
PricewaterhouseCoopers LLP
Chartered Accountants and Statutory Auditors
7 More London Riverside
London SE1 2RT
United Kingdom
Hiscox Syndicate 3624
Hiscox Syndicates 3624 Report and Accounts 2025
1
Report of the Directors of the managing agent
Hiscox Syndicate 3624 annual accounts
The Directors of the managing agent present their report for
Syndicate 3624 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 Syndicate
continues to adopt the going concern basis in preparing
the syndicate annual accounts.
Results
The result for Syndicate 3624 in calendar year 2025 is a profit
of $52.6 million (2024: profit of $58.6 million). The result has
benefitted from an investment return which has made a
significant contribution to profit, which is driven by fixed income
returns and is primarily underpinned by coupon income and
cash returns. Positive underwriting profit also contributed, driven
by favourable prior-year results across most lines and solid
current year performance. Expenses have increased modestly,
primarily due to higher financing costs and an overall rise in
Group recharges. Premium has declined marginally, mainly
due to challenges being experienced across all lines due to
increased competition and growing rate pressure.
The Syndicate’s key financial performance indicators during
the year were as follows:
2025
2024
%
$m
$m
Change
Gross premiums written
232.1
234.1
(0.9)
Gross premiums earned
233.3
237.9
(1.9)
Net premiums earned
230.6
228.5
0.9
Total recognised profit for
the year
52.6
58.6
(10.2)
Claims ratio (%)
52.1
47.6
4.5
Commission ratio (%)
35.2
36.2
(1.0)
Expense ratio (%)
8.2
5.8
2.4
Combined ratio (%)
95.5
89.6
5.9
Principal activity
The principal activity of Syndicate 3624 remains the transaction
of insurance and reinsurance business at Lloyd’s of London. The
majority of the Syndicate’s insurance business is US business
written on a surplus lines basis. Syndicate 3624 trades through
the Lloyd’s worldwide licences and rating. It also benefits from
the Lloyd’s brand. Lloyd’s and Lloyd’s Brussels has an A+
(Superior) rating from A.M. Best, AA- (Very strong) rating from
S&P, AA- (Very strong) from Fitch and AA- (Very strong) from
Kroll Bond Rating Agency.
The geographical and currency split of its business is
shown below:
Geographical split of gross premiums written (%)
2025
2024
UK
8
9
Europe
1
—
North America
91
90
Asia
—
—
Rest of the world
—
1
Geographical premiums written settlement currency (%)
2025
2024
Sterling
5
7
Euro
1
1
US Dollar
94
92
Canadian Dollar
—
—
Hiscox Syndicate 3624
2
Hiscox Syndicates 3624 Report and Accounts 2025
Review of the business
The result for the year was a profit of $52.6 million (2024: profit
of $58.6 million). The gross premiums written by class of
business is shown below:
Gross premiums written by class of business ($m)
Division
2025
2024
Gross premiums
written
Gross premiums
written
$m
$m
General liability
9.6
9.2
Liability
193.6
193.9
Technology, media and telecoms
27.7
29.4
Reinsurance
0.1
0.1
Other
1.1
1.5
Total
232.1
234.1
Syndicate 3624 was established as an aligned corporate
syndicate for the 2009 year of account. Initially, all of the
Syndicate’s business was generated through Hiscox owned
distribution channels, in particular Hiscox Inc., the Group’s
service company in the USA. In subsequent years a number of
additional lines of business were added to the portfolio, some of
which were sourced through Hiscox owned service companies
and some through normal London Market broking channels.
However, more recently, the portfolio has reverted to its original
constitution (albeit much larger) as a result of the remediation
actions to exit unprofitable lines. Syndicate 3624 now exclusively
underwrites through our retail business units in the UK, Europe
and the USA.
The following classes are written through Hiscox owned service
companies and the London Market broking channel. The
Syndicate pays a commission to source business from the
Hiscox offices on the ground in the USA.
General liability
This account covers a broad spectrum of protection including
unexpected and unintentional bodily injury and property damage.
Stand alone US general liability is fully exited since 2022.
Liability
This account covers the US allied healthcare, architects and
engineers, cyber and miscellaneous errors and omissions
insurance. US directors and officers’ insurance and US financial
lines are fully exited since 2022.
Technology, media and telecoms
This account provides professional indemnity insurance for the
technology and media industries and is sourced from Hiscox
owned service companies in the USA, Europe and UK. Media
also includes entertainment risks which gives both errors and
omissions insurance for TV programmes and films and also
production insurance for the filming of TV programmes and films.
Reinsurance
This account includes casualty reinsurance written through the
Hiscox service company in Bermuda, which is in run-off, and a
small quota share of the property reinsurance business written
by Hiscox Bermuda.
Other
This includes insurance for event cancellation and some
accounts in run-off such as pilot’s loss of licence and
product recall.
2026 and the future
For 2026, the Syndicate has maintained the stamp capacity at
£400 million ($538 million). The Syndicate remains committed to
pursuing profitable growth by leveraging market opportunities
and executing strategic expansion through its newly established
division, Hiscox Portfolio Solutions. This division is designed to
provide comprehensive portfolio insights and support the
achievement of sustained, market-leading results.
Hiscox Syndicate 3624
Report of the Directors of the managing agent
Hiscox Syndicates 3624 Report and Accounts 2025
3
Years of account
2020
2021
2022
2023
2024
2025
2026
Capacity (£m)
400
400
400
400
400
400
400
Capacity ($m)*
538
538
538
538
538
538
538
*Converted at the closing rate at 31 December 2025.
Capital
One of the main advantages of trading through Lloyd’s is the
considerably lower capital ratios that are available due to the
diversification of business written in Hiscox Syndicate 3624 and
in Lloyd’s as a whole. The size of the Syndicate is increased or
reduced according to the strength of the insurance environment
in its main classes.
The Hiscox Syndicates Limited (HSL) internal capital model is
used to set the Syndicate’s capital. Syndicate capital is
determined through the submission and agreement by Lloyd’s of
an ultimate solvency capital requirement (SCR), which is subject
to an uplift determined by the Franchise Board to calibrate the
capital required by Lloyd’s. Lloyd’s unique capital structure
provides excellent financial security to policyholders and capital
efficiency for members. This chain of security provides the
financial strength that ultimately backs insurance policies written
at Lloyd’s and has three links:
1.
all premiums received by syndicates are held in trust as the
first resource for paying policyholders’ claims;
2.
every member is required to hold capital at Lloyd’s which is
held in trust and known as Funds at Lloyd’s (FAL). These
funds are intended primarily to cover circumstances where
syndicate assets prove insufficient to meet participating
members’ underwriting liabilities. They are set with
reference to the SCR together with the Lloyd’s uplift. Since
FAL is not under the control of the managing agent, no
amount has been shown in the annual accounts. However,
the managing agent is able to make a call on the members’
FAL to meet liquidity requirements or to settle losses; and
3.
the central assets are available at the discretion of the
Council of Lloyd’s to meet any valid claim that cannot
be met from the resources of any member further up
the chain.
Lloyd’s works in co-operation with insurance regulators in the
USA and other parts of the world to further strengthen the
security of a Lloyd’s policy. This has resulted in significant
amounts of the Syndicate’s funds being held in various trust
funds. We have determined that the Syndicate has sufficient
levels of liquidity to meet its expected funding requirements.
However, we put members on notice that we may need to
make a cash call, at some time in the future, to improve the
Syndicate’s working capital position.
The Syndicate continues to use the Lloyd’s Brussels platform to
transact European Union risks. Lloyd’s Brussels benefits from
the market’s financial strength through the Central Fund and has
the same financial ratings as Lloyd’s: A.M. Best A+ (Superior),
S&P AA- (Very strong), Fitch AA- (Very strong) and Kroll Bond
Rating Agency AA- (Very strong). The Company is authorised
and regulated by the National Bank of Belgium and capitalised
under Solvency UK rules.
Investment report
The investment result for Syndicate 3624 was a gain of $40.4
million (2024: gain of $35.0 million) equating to a return of 5.8%
(2024: return of 5.0%). The Syndicate’s invested assets totalled
$673.4 million at 31 December 2025 (2024: $697.8 million).
Fixed income returns were primarily driven by the earn through
of coupon and cash income.
Additionally, mark-to-market bond
returns contributed to the investment income.
Principal risks and uncertainties
A description of the principal risks and uncertainties facing the
Syndicate is set out in note 4.
Directors’ interests
None of the Directors of the managing agent who served during
the year ended 31 December 2025 were underwriting members
at Lloyd’s for the 2023, 2024, 2025 or 2026 years of account.
M B Boucher – Non Executive (appointed 1 January 2025)
A P Dolphin
H Hanna – (appointed 13 November 2025)
T W Harris – Non Executive
T C Huerlimann – Non Executive Chair
H A Hussain
J L T Illingworth – Non Executive
S E Kemble
P A Lawrence
K J M Markham
J R Musselle
H Rose – (resigned 22 January 2026)
D S Saker – (appointed 22 January 2026)
Hiscox Syndicate 3624
Report of the Directors of the managing agent
4
Hiscox Syndicates 3624 Report and Accounts 2025
Disclosure of information to the auditors
The Directors of the managing agent who held office at the date
of approval of this managing agent’s report confirm that, so far
as they are each aware, there is no relevant audit information of
which the Syndicate’s auditors are unaware; and each Director
has taken all the steps that they ought to have taken as a
Director to make themselves aware of any relevant audit
information and to establish that the Syndicate’s auditors are
aware of that information.
Annual General Meeting
Usually the only formal business conducted at the Syndicate
Annual General Meeting (AGM) is the appointment of the
Syndicate auditors for the following year, and usually the
attendance at the AGM, when it is held, is minimal.
In accordance with the Insurance Accounts Directive
(Lloyd’s Syndicate and Aggregate Accounts) (the 2008
Regulations) a Syndicate AGM was held in 2016 to appoint
PricewaterhouseCoopers LLP (PwC) as the Syndicate’s
registered auditors. The 2008 Regulations contain provisions
for the re-appointment of the Syndicate’s registered auditors.
Lloyd’s requirements allow managing agents to dispense with
the requirement to hold a Syndicate AGM, providing certain
criteria are met.
This year, we therefore give notice that:
•
Hiscox Syndicates Limited does not propose to hold an
AGM of the members of Syndicate 3624 in 2026;
•
PwC will be deemed to be re-appointed as the Syndicate’s
registered auditors pursuant to the 2008 Regulations;
•
members may object to the matters set out above within
21 days of this notice.
If no objections to this are received from any members within the
specified period, we shall notify Lloyd’s to that effect.
If any objections are received, depending on the level or nature
of such objections, we shall then consider whether to:
1.
apply for Lloyd’s consent not to hold an AGM. Lloyd’s may
give its consent subject to any such conditions and
requirements as it may determine; or
2.
convene an AGM.
By order of the Board
David Saker
Chief Financial Officer
17 February 2026
Hiscox Syndicate 3624
Report of the Directors of the managing agent
Hiscox Syndicates 3624 Report and Accounts 2025
5
Statement of managing agent’s responsibilities
Hiscox Syndicate 3624
annual accounts
The managing agent is responsible for preparing the Syndicate
Annual Report and Accounts in accordance with applicable law
and regulations.
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 UK accounting standards and
applicable law (UK Generally Accepted Accounting Practice).
The syndicate annual accounts are required by law to give a
true and fair view of the state of affairs of the Syndicate at that
date and of its profit or loss for that year.
In preparing those syndicate annual accounts, the managing
agent is required to:
•
select suitable accounting policies and then apply them
consistently, subject to changes arising on the adoption
of new accounting standards in the year;
•
make judgements and estimates that are reasonable
and prudent;
•
state whether applicable accounting standards have been
followed, subject to any material departures disclosed and
explained in the syndicate annual accounts; and
•
prepare the syndicate annual accounts on the basis that
the Syndicate will continue to write future business unless
it is inappropriate to presume the Syndicate will do so.
The managing agent is responsible for keeping proper
accounting records that disclose with reasonable accuracy, at
any time, the financial position of the Syndicate and enable it to
ensure that the syndicate annual accounts, including the iXBRL
tagging applied to these accounts, comply with the Insurance
Accounts Directive (Lloyd’s Syndicate and Aggregate Accounts)
Regulations 2008. It is also responsible for safeguarding the
assets of the Syndicate and hence for taking reasonable steps
for prevention and detection of fraud and other irregularities.
The managing agent is responsible for the maintenance and
integrity of the corporate and financial information included on
the company’s website. Legislation in the UK governing the
preparation and dissemination of the syndicate 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.
David Saker
Chief Financial Officer
17 February 2026
Hiscox Syndicate 3624
6
Hiscox Syndicates 3624 Report and Accounts 2025
Report on the audit of the syndicate annual accounts
Opinion
In our opinion, 3624’s syndicate annual accounts:
•
give a true and fair view of the state of the Syndicate’s
affairs as at 31 December 2025 and of its profit and
cash flows for the year then ended;
•
have been properly prepared in accordance with United
Kingdom Generally Accepted Accounting Practice (United
Kingdom Accounting Standards, including FRS 102 ‘The
Financial Reporting Standard applicable in the UK and
Republic of Ireland’, and applicable law); and
•
have been prepared in accordance with the requirements
of The Insurance Accounts Directive (Lloyd’s Syndicate
and Aggregate Accounts) Regulations 2008 and the
requirements within the Lloyd’s Syndicate Accounts
Instructions version 3.1 as modified by the Frequently
Asked Questions issued by Lloyd’s version 1.1 (‘the
Lloyd’s Syndicate Instructions’).
We have audited the syndicate annual accounts included
within the
Annual
Report and Accounts (the ‘Annual Report’),
which comprise:
B
alance sheet – assets and the
B
alance sheet
– liabilities as at 31 December 2025; the
P
rofit and loss account:
technical account – general business and
P
rofit and loss
account: non-technical
account
– general business, the
S
tatement
of cash flows, and the
S
tatement of changes in
members’
balances for the year then ended; and the notes to the
syndicate annual accounts, which include a description
of the significant accounting policies.
Basis for opinion
We conducted our audit in accordance with International
Standards on Auditing (UK) (ISAs (UK)), and The Insurance
Accounts Directive (Lloyd’s Syndicate and Aggregate
Accounts) Regulations 2008
, the Lloyd's Syndicate Instructions
and applicable law. Our responsibilities under ISAs (UK) are
further described in the auditors’ responsibilities for the audit of
the syndicate annual accounts section of our report. We believe
that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our opinion.
Independence
We remained independent of the Syndicate in accordance with
the ethical requirements that are relevant to our audit of the
syndicate annual accounts in the UK, which includes the FRC’s
Ethical Standard, as applicable to other entities of public interest,
and we have fulfilled our other ethical responsibilities in
accordance with these requirements.
To the best of our knowledge and belief, we declare that
non-audit services prohibited by the FRC’s Ethical Standard
were not provided.
Other than those disclosed in note 6, we have provided no
non-audit services to the Syndicate in the period under audit.
Conclusions relating to going concern
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 at least
twelve
months from when the syndicate annual
accounts are authorised for issue.
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.
However, because not all future events or conditions can be
predicted, this conclusion is not a guarantee as to the
Syndicate’s ability to continue as a going concern.
Our responsibilities and the responsibilities of the managing
agent with respect to going concern are described in the
relevant sections of this report.
Reporting on other information
The other information comprises all of the information in the
Annual Report other than the syndicate annual accounts and
our auditors’ report thereon. The managing agent is responsible
for the other information. Our opinion on the syndicate annual
accounts does not cover the other information and, accordingly,
we do not express an audit opinion or, except to the extent
otherwise explicitly stated in this report, any form of
assurance thereon.
In connection with our audit of the syndicate annual accounts,
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 audit, or otherwise appears to
Hiscox Syndicate 3624
Independent auditors’ report
To the members of Hiscox Syndicate 3624
Hiscox Syndicates 3624 Report and Accounts 2025
7
be materially misstated. If we identify an apparent material
inconsistency or material misstatement, we are required to
perform procedures to conclude whether there is a material
misstatement of the syndicate annual accounts or a material
misstatement of the other information. If, based on the work
we have performed, we conclude that there is a material
misstatement of this other information, we are required to
report that fact. We have nothing to report based on
these responsibilities.
With respect to the
R
eport of the Directors of the managing
agent (the ‘managing agent’s report’), we also considered
whether the disclosures required by The Insurance Accounts
Directive (Lloyd’s Syndicate and Aggregate Accounts)
Regulations 2008 have been included.
Based on our work undertaken in the course of the audit, The
Insurance Accounts Directive (Lloyd’s Syndicate and Aggregate
Accounts) Regulations 2008 requires us also to report certain
opinions and matters as described below.
Managing agent’s report
In our opinion, based on the work undertaken in the course of
the audit, the information given in the managing agent’s report
for the year ended 31 December 2025 is consistent with the
syndicate annual accounts and has been prepared in
accordance with applicable legal requirements.
In light of the knowledge and understanding of the Syndicate
and its environment obtained in the course of the audit, we
did not identify any material misstatements in the managing
agent’s report.
Responsibilities for the syndicate annual accounts and
the audit
Responsibilities of the managing agent for the syndicate
annual accounts
As explained more fully in the
S
tatement of managing agent’s
responsibilities, the managing agent is responsible for the
preparation of the syndicate annual accounts in accordance
with the applicable framework and for being satisfied that they
give a true and fair view. The managing agent is also responsible
for such internal control as they determine is necessary to
enable the preparation of syndicate annual accounts that are
free from material misstatement, whether due to fraud or error.
In preparing the syndicate annual accounts, the managing agent
is responsible for assessing the Syndicate’s ability to continue as
a going concern, disclosing as applicable, matters related to
going concern and using the going concern basis of accounting
unless it is intended for the Syndicate to cease operations, or it
has no realistic alternative but to do so.
Auditors’ 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 auditors’ 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.
Irregularities, including fraud, are instances of non-compliance
with laws and regulations. We design procedures in line with our
responsibilities, outlined above, to detect material misstatements
in respect of irregularities, including fraud. The extent to which
our procedures are capable of detecting irregularities, including
fraud, is detailed below.
Based on our understanding of the Syndicate and industry, we
identified that the principal risks of non-compliance with laws
and regulations related to breaches of regulatory principles,
such as those governed by the Prudential Regulation Authority
and the Financial Conduct Authority, and those regulations set
by the Council of Lloyd’s, and we considered the extent to
which non-compliance might have a material effect on the
syndicate annual accounts.
We also considered those laws and regulations that have a
direct impact on the syndicate annual accounts such as The
Insurance Accounts Directive (Lloyd’s Syndicate and Aggregate
Accounts) Regulations 2008
and the Lloyd's Syndicate
Instructions
. We evaluated management’s incentives and
opportunities for fraudulent manipulation of the syndicate annual
accounts (including the risk of override of controls), and
determined that the principal risks were related to manual
Hiscox Syndicate 3624
Independent auditors’ report
8
Hiscox Syndicates 3624 Report and Accounts 2025
journals relating to revenue and accounting estimates in respect
of the valuation of claims outstanding. Audit procedures
performed by the engagement team included:
•
discussions with senior management, including those in
the risk and compliance functions, including consideration
of known or suspected instances of non-compliance with
laws, regulation and fraud;
•
reading key correspondence with Lloyd’s, in relation to
compliance with laws and regulations;
•
reviewing relevant meeting minutes including those of the
Audit Committee;
•
testing journal entries identified in accordance with our
risk assessment;
•
testing and assessing the appropriateness of insurance
claims reserves;
and
•
designing audit procedures to incorporate unpredictability
around the nature, timing and extent of our testing.
There are inherent limitations in the audit procedures
described above. We are less likely to become aware of
instances of non-compliance with laws and regulations that
are not closely related to events and transactions reflected in
the syndicate annual accounts. Also, 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.
A further description of our responsibilities for the audit of the
syndicate annual accounts is located on the FRC’s website at:
www.
frc.org.uk/auditorsresponsibilities
. This description forms
part of our auditors’ report.
Use of this report
This report, including the opinions, has been prepared for and
only for the Syndicate’s members as a body in accordance with
part 2 of The Insurance Accounts Directive (Lloyd’s Syndicate
and Aggregate Accounts) Regulations 2008 and for no other
purpose. We do not, in giving these opinions, accept or assume
responsibility for any other purpose or to any other person to
whom this report is shown or into whose hands it may come
save where expressly agreed by our prior consent in writing.
Other required reporting
Under The Insurance Accounts Directive (Lloyd’s Syndicate and
Aggregate Accounts) Regulations 2008 we are required to report
to you if, in our opinion:
•
we have not obtained all the information and explanations
we require for our audit; or
•
adequate accounting records have not been kept by the
managing agent in respect of the Syndicate; or
•
certain disclosures of managing agent remuneration
specified by law are not made; or
•
the syndicate annual accounts are not in agreement with
the accounting records.
We have no exceptions to report arising from this responsibility.
Other matter
We draw attention to the fact that this report may be included
within a document to which iXBRL tagging has been applied.
This auditors’ report provides no assurance over whether the
iXBRL tagging has been applied in accordance with section 2
of the Lloyd’s Syndicate Instructions version 3.1.
Neil Riches
(Senior Statutory Auditor)
for and on behalf of
PricewaterhouseCoopers LLP
Chartered Accountants and Statutory Auditors
London
17 February 2026
Hiscox Syndicate 3624
Independent auditors’ report
Hiscox Syndicates 3624 Report and Accounts 2025
9
Profit and loss account:
technical account – general business
Hiscox Syndicate 3624 annual accounts
For the year ended 31 December 2025
2025
2024
Note
$000
$000
Gross premiums written
5
Outward reinsurance premiums
(2,211 )
(8,743 )
Premiums written, net of reinsurance
Change in the provision for unearned premiums:
Gross amount
Reinsurers' share
(457 )
(632 )
Net change in provisions for unearned premiums
Earned premiums, net of reinsurance
Allocated investment return transferred from/(to) the non-technical account
Claims paid:
Gross amount
10
(177,333 )
(230,908 )
Reinsurers' share
10
Net claims paid
(109,028 )
(102,088 )
Change in the provision for claims:
Gross amount
Reinsurers' share
(79,930 )
(127,047 )
Net change in provisions for claims
(11,183 )
(6,630 )
Claims incurred, net of reinsurance
(120,211 )
(108,718 )
Net operating expenses
6
(99,924 )
(95,837 )
Balance on the technical account for general business
The notes on pages 16 to 39 form an integral part of these annual accounts.
Hiscox Syndicate 3624
10
Hiscox Syndicates 3624 Report and Accounts 2025
Profit and loss account:
non-technical account – general business
Hiscox Syndicate 3624 annual accounts
For the year ended 31 December 2025
2025
2024
Note
$000
$000
Balance on the technical account for general business
Investment income
8
Realised gains/(losses) on investments
8
(1,029 )
Unrealised gains on investments
8
Investment expenses and charges
8
(429 )
(558 )
Total investment return
Allocated investment return transferred (to)/from the general business technical account
(40,352 )
(35,000 )
Foreign exchange gains/(losses)
(369 )
Profit for the financial year
There are no recognised gains or losses in the accounting year other than those dealt with in the technical and non-technical
accounts, therefore no statement of other comprehensive income has been presented.
The notes on pages 16 to 39 form an integral part of these annual accounts.
Hiscox Syndicate 3624
Hiscox Syndicates 3624 Report and Accounts 2025
11
Balance sheet – assets
Hiscox Syndicate 3624 annual accounts
At 31 December 2025
2025
2024
Note
$000
$000
Investments
Financial investments
9
Deposits with ceding undertakings
Reinsurers' share of technical provisions
Provision for unearned premium
10
Claims outstanding
10,14
Debtors
Debtors arising out of direct insurance operations
11
Debtors arising out of reinsurance operations
12
Other debtors
13
Other assets
Cash at bank and in hand
19
Other
Prepayments and accrued income
Accrued interest
Deferred acquisition costs
10
Other prepayments and accrued income
Total assets
The notes on pages 16 to 39 form an integral part of these annual accounts.
Hiscox Syndicate 3624
12
Hiscox Syndicates 3624 Report and Accounts 2025
Balance sheet – liabilities
Hiscox Syndicate 3624 annual accounts
At 31 December 2025
2025
2024
Note
$000
$000
Capital and reserves
Members' balances
Technical provisions
Provision for unearned premium
10
Claims outstanding
10,14
Creditors
Creditors arising out of direct insurance operations
15
Creditors arising out of reinsurance operations
16
Other creditors
17
Accruals and deferred income
18
Total liabilities
Total liabilities, capital and reserves
The notes on pages 16 to 39 form an integral part of these annual accounts.
The syndicate annual accounts on pages 10 to 39 were approved by the Board of Hiscox Syndicates Limited and were signed on its
behalf by
David Saker
Chief Financial Officer
17 February 2026
Hiscox Syndicate 3624
Hiscox Syndicates 3624 Report and Accounts 2025
13
Statement of changes in members’ balances
Hiscox Syndicate 3624 annual accounts
Year ended 31 December 2025
2025
2024
$000
$000
Members' balances brought forward at 1 January
(23,852 )
Total recognised gains for the year
Payments of profit to members’ personal reserve funds
(42,247 )
Losses collected in relation to distribution on closure of underwriting year
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.
A profit payment distribution of $56.9 million to members will be proposed in relation to the closing year of account 2023 (2024:
profit payment distribution of $42.2 million in relation to the closing year of account 2022). There are no years of account remaining
open after the three-year period.
Hiscox Syndicate 3624
14
Hiscox Syndicates 3624 Report and Accounts 2025
Statement of cash flows
Hiscox Syndicate 3624 annual accounts
Year ended 31 December 2025
2025
2024
Note
$000
$000
Cash flows from operating activities
Profit for the year
Decrease in gross technical provisions
(66,628 )
(125,980 )
Decrease in reinsurers' share of gross technical provisions
Decrease in debtors
Decrease in creditors
(54,569 )
(100,836 )
Movement in other assets/liabilities
Investment return
(40,352 )
(35,000 )
Foreign exchange
(8,615 )
Net cash flows from operating activities
(31,739 )
(66,321 )
Cash flows from investing activities
Purchase of equity and debt instruments
(395,952 )
(264,184 )
Sale of equity and debt instruments
Purchase of derivatives
(91 )
Investment income received
Other
(518 )
Net cash flows from investing activities
Cash flows from financing activities
Distribution of profits
(42,247 )
Collection of losses
Net cash flows from financing activities
(42,247 )
Net (decrease)/increase in cash and cash equivalents
(33,930 )
Effect of exchange rates on cash and cash equivalents
(626 )
Cash and cash equivalents at the beginning of the year
Cash and cash equivalents at the end of the year
19
Included within cash and cash equivalents are balances totalling $1.8 million (2024: $2.2 million) not available for immediate use by
the Syndicate.
Hiscox Syndicate 3624
Hiscox Syndicates 3624 Report and Accounts 2025
15
Notes to the accounts
Hiscox Syndicate 3624 annual accounts
1 Basis of preparation
These annual accounts have been prepared in accordance with
regulation 5 of the Insurance Accounts Directive (Lloyd’s
Syndicate and Aggregate Accounts) Regulations 2008 and
applicable accounting standards in the United Kingdom, Financial
Reporting Standard 102, The Financial Reporting Standard
applicable in the United Kingdom and the Republic of Ireland (FRS
102), Financial Reporting Standard 103 and Insurance Contracts
(FRS 103) where applicable, and the Lloyd’s Syndicate Accounts
Instructions Version 3.1 as modified by the Frequently Asked
Questions Version 1.1 issued by Lloyd’s.
These annual accounts are presented in US Dollars, which is the
Syndicate’s functional currency. All amounts have been rounded
to the nearest thousand, unless otherwise indicated. Some
disclosure items, for example, Syndicate capacity, are presented
in Sterling as it is denominated in this currency; US Dollar amounts
are converted at the closing rate at 31 December 2025.
The Directors of the managing agent have prepared the annual
accounts on a going concern basis. In adopting the going
concern basis, the Syndicate’s current and forecast solvency and
liquidity positions for the next 12 months and beyond has been
reviewed. As part of the consideration of the appropriateness of
adopting the going concern basis, the Directors used scenario
analysis to assess the robustness of the Syndicate’s solvency
and liquidity positions. In undertaking this analysis, no material
uncertainty in relation to going concern has been identified, due
to the Syndicate's strong capital and liquidity positions providing
resilience to shocks, underpinned by the Syndicate's approach to
risk management described in note 4.
In addition to the above, Lloyd’s require the Syndicate to
perform an assessment of certain events on the financial position
of the Syndicate by running specific realistic disaster scenarios
(RDS). This is then translated into a capital requirement which
the members must adhere to. It can be demonstrated that
under the selected RDS scenarios, the Syndicate will continue
to operate and any capital requirements can be provided for
from the members’ funds at Lloyd’s (FAL).
In fact, no capital requirement is set for the Syndicate. Capital
requirements are set at the member level and a member is not
allowed to participate in the Syndicate if they have not met their
capital requirement and the capacity of the Syndicate is adjusted
down to reflect this.
The Syndicate benefits from being part of the Lloyd’s capital
structure, often referred to as the chain of security, which
provides excellent financial security to policyholders and capital
efficiency for members. The three elements that make up the
Lloyd’s capital structure are:
1.
syndicate assets – members’ working capital. All premiums
received by the Syndicates are held in trust by the
managing agents as the first resource for paying
policyholders’ claims and to fund regulatory deposits. Until
all liabilities have been provided for, no profits can be
released. Every year, the Syndicates’ reserves for future
liabilities are independently audited and subject to an
actuarial review;
2.
funds at Lloyd’s – members’ capital deposited at Lloyd’s.
Each member, whether corporate or individual, must
provide sufficient capital to support their underwriting at
Lloyd’s. Managing agents are required to assess the
solvency capital requirement (SCR) for each syndicate that
they manage. This sets out how much capital the syndicate
requires to cover its underlying business risks at a 99.5%
confidence level; and
3.
Lloyd’s central capital – Lloyd’s central assets, which
include the Central Fund, are available, at the discretion of
the Council of Lloyd’s, to meet any valid claim that cannot
be met from the resources of any member.
After making enquiries, the Directors have a reasonable
expectation that the Syndicate has adequate resources to
continue in operational existence over a period of at least
12 months from the date of this report. For this reason, the
Syndicate continues to adopt the going concern basis in
preparing its annual accounts.
Hiscox Syndicate 3624
16
Hiscox Syndicates 3624 Report and Accounts 2025
2 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.
2(a) Premiums
Written gross and outwards reinsurance premiums comprise
premiums on contracts incepting during the financial year,
together with adjustments made in the year to premiums
written in prior years. Written premiums are disclosed gross
of commission payable to intermediaries and exclude taxes
and duties levied on premiums.
Premiums written include estimates for premiums due but not
yet received or notified, less an allowance for expected
cancellations. For certain contracts, premium is initially
recognised based on estimates of ultimate premium. This occurs
where pricing is based on variables, which are not known with
certainty at the point of binding the policy. In determining the
estimated premium, use is made of information provided by
brokers and coverholders, past underwriting experience, the
contractual terms of the policy and prevailing market conditions.
Subsequently, adjustments to those estimates arise as updated
information relating to those pricing variables becomes available,
for example, due to declarations obtained on binding authority
contracts, reinstatement premium on reinsurance contracts or
other policy amendments. Such adjustments are recorded in the
period in which they are determined and impact gross premiums
written in the income statements and premiums receivable from
insureds and cedants recorded on the balance sheet.
Outwards reinsurance premiums are also disclosed gross of
commissions and profit participations recoverable from reinsurers.
Retroactive insurance contracts that contain significant insurance
risk and that have an insurance component and a deposit
component are unbundled providing the deposit component can
be measured separately. The deposit component is recorded
directly into the balance sheet within reinsurers’ share of insurance
liabilities with a corresponding amount in creditors arising out of
reinsurance operations. The reinsurers’ share of insurance
liabilities relating to the contracts is remeasured at each reporting
period with movements taken to the reinsurance recoveries in the
income statement. Reinsurance transactions that transfer risk but
are retroactive are included in reinsurance assets. The excess of
estimated liabilities for claims and claim expenses over the
consideration paid is established as a deferred credit at inception.
The deferred amounts are subsequently amortised using the
recovery method over the settlement period of the reserves
and reflected through the claims and claim adjustment expenses
line. In transactions where the consideration paid exceeds the
estimated liabilities for claims and claim adjustment expenses,
a loss is recognised immediately.
2(b) Unearned premiums
The provision for unearned premiums comprises the proportion
of gross premiums written which is estimated to be earned in the
following or subsequent financial periods, computed using the
daily pro rata method, adjusted if necessary to reflect any
variation in the incidence of risk during the period covered
by the contract.
2(c) Acquisition costs
Acquisition costs comprise all direct and indirect costs arising
from the acquisition of insurance contracts. Deferred acquisition
costs represent the proportion of acquisition costs incurred
which corresponds to the proportion of gross premiums written
which is unearned at the balance sheet date.
2(d) Claims
Claims incurred in respect of general business are charged to
profit or loss as incurred, based on the estimated liability for
compensation owed to contract holders or third parties
damaged by the contract holders. They include direct and
indirect claims settlement costs and arise from events that have
occurred up to the balance sheet date, even if they have not
yet been reported to the Syndicate. The Syndicate does not
discount its liabilities for unpaid claims. Liabilities for unpaid
claims are estimated using the input of assessments for
individual cases reported to the Syndicate and statistical analysis
for the claims incurred but not reported, and an estimate of the
expected ultimate cost of more complex claims that may be
affected by external factors, for example, court decisions.
Claims paid are transactions in the period which have been
signed through Lloyd’s Central Accounting or Lloyd’s Direct
Reporting, adjusted for any material backlogs which may occur
between cash paid and the claims being signed through.
Reinsurers’ share of claims paid are all transactions in the
period which have been signed through the London Outwards
Reinsurance System, adjusted to include an accrual for the
balances which have been billed, but remain unsettled at the
balance sheet date. Reinsurers’ share of claims outstanding
is the amount that it is estimated will be recoverable from
reinsurers based upon the gross claims provisions having
allowed for bad debt. Reinsurance recoveries are estimated
by reviewing individual claims including allowance for claims
incurred but not reported, and assessing the reinsurance
recovery which is expected based on the outwards reinsurance
protections. Amounts recoverable from, or due to, reinsurers
are measured consistently with the amounts associated with
the reinsured insurance contracts and in accordance with the
terms of each reinsurance contract.
While the Directors consider that the gross provisions for claims
and the related reinsurance recoveries are fairly stated on the
basis of the information currently available to them, the ultimate
liability will vary as a result of subsequent information and events
and may result in significant adjustments to the amounts
provided. Adjustments to the amounts of claims provisions
established in prior years are reflected in the annual accounts
for the period in which the adjustments are made. The methods
used, and estimates made, are reviewed regularly.
The benefits to which the Syndicate is entitled under outwards
reinsurance contracts are recognised as reinsurance assets.
These assets consist of short-term balances due from
reinsurers, as well as longer-term receivables (classified
within assets) that are dependent on the expected claims and
benefits arising under the related reinsured insurance contracts.
Amounts recoverable from, or due to, reinsurers are measured
consistently with the amounts associated with the reinsured
insurance contracts and in accordance with the terms of each
reinsurance contract.
Hiscox Syndicate 3624
Notes to the accounts
Hiscox Syndicates 3624 Report and Accounts 2025
17
2(e) Unexpired risk
Provision is made for unexpired risks arising from general
business where the expected value of the claims and expenses
attributable to the unexpired periods of policies in force at the
balance sheet date exceeds the unearned premiums provision
in relation to such policies after the deduction of any acquisition
costs deferred. The provision for unexpired risks is assessed at a
business class level which is the level at which the contracts are
managed together.
2(f) Financial assets and liabilities
Financial assets and liabilities include cash at bank and in hand,
financial investments and debtors and creditors. Financial
investments comprise debt securities and other fixed income
securities, shares and other variable yield securities and units in
unit trusts, syndicate loans to central fund and derivative assets.
i.
Financial investments at fair value through profit and loss
Financial investments are managed on a fair value through
the profit and loss accounts (FVPL) basis as they are
managed and their performance is evaluated on that
basis in accordance with the Syndicate’s investment
strategy. The Syndicate has elected to measure
financial investments at fair value through the profit
and loss non-technical account.
ii.
Debtors and creditors
Debtors and creditors are primarily non-derivative financial
assets and liabilities with fixed or determinable payments
and not quoted on an active market. These include
amounts due to and from agents, brokers and insurance
contract holders.
Debtors are initially recognised when due at transaction
price, and where applicable are subsequently measured at
amortised cost using the effective interest rate method.
The recoverability of these assets is assessed at each
balance date and appropriate provision made to ensure
that the balances properly reflect the amounts that will
ultimately be received, taking into account counterparty
credit risk and the contractual terms of the contract. Where
receivable is impaired, the Syndicate reduces the carrying
amount of the receivable accordingly and recognises the
impairment loss in the profit or loss account.
Creditors are initially recognised at transaction price, and
where applicable, are subsequently measured at amortised
cost using the effective interest rate method.
iii.
Derivative financial instruments
Derivative financial instruments are measured at cost for
initial recognition, and subsequently at fair value, with
changes recognised in profit and loss. Transaction
costs incurred in buying and selling derivative financial
instruments are recognised in profit or loss when incurred.
When derivatives are liabilities, they are reported with other
creditors in the balance sheet.
2(g) Investment return
All investment return is initially recognised in the non-technical
account. It is then transferred to the technical account as it all
relates to funds supporting underwriting business.
Realised gains or losses on investments represent the difference
between net sales proceeds and their purchase price.
Unrealised gains and losses on investments represent the
difference between the fair value of investments at the balance
sheet date and their purchase price or their valuation at the
commencement of the year. The movement in unrealised
investment gains/losses includes an adjustment for previously
recognised unrealised gains/losses on investments disposed of
in the accounting period.
2(h) Foreign currency translation
The functional and presentational currency of the Syndicate is
US Dollars which is the currency of the primary economic
environment in which the Syndicate operates.
Transactions denominated in foreign currencies are recorded
at the rates of exchange ruling at the date of the transactions.
At the balance sheet date, monetary assets and liabilities are
translated at the year-end rates of exchange. For the purpose of
foreign currency translation, unearned premiums and deferred
acquisition costs are treated as if they are monetary items.
Differences arising on translation of foreign currency amounts
relating to insurance operations of the Syndicate are included in
profit/(loss) on foreign exchange in the non-technical account.
2(i) Taxation
Under Schedule 19 of the Finance Act 1993, managing agents
are not required to deduct basic rate income tax from trading
income. In addition, all UK basic rate income tax deducted from
Syndicate investment income is recoverable by managing agents
and consequently the distribution made to members or their
members’ agents is gross of tax. Capital appreciation falls within
trading income and is also distributed gross of tax.
No provision has been made for any US federal income tax
payable on underwriting results or investment earnings. Any
payments on account made by the Syndicate during the year are
included in the balance sheet under the heading ‘other debtors’.
No provision has been made for any overseas tax payable by
members on underwriting results.
2(j) Bad debts
Bad debts are provided for only where specific information is
available to suggest a debtor may be unable or unwilling to
settle its debt to the Syndicate. The provision is calculated on
a case-by-case basis.
2(k) Reinsurers’ commissions and profit participations
Reinsurers’ commissions and profit participations, which include
reinsurance profit commission and overriding commission, are
treated as a contribution to expenses.
2(l) Cash at bank and in hand
This consists of cash at bank and in hand and deposits held
at call with banks, and other highly liquid investments that are
readily convertible to known amounts of cash and which are
subject to an insignificant risk of changes in value.
2(m) Deposits with ceding undertakings
Deposits with ceding undertakings are funds held by Lloyd’s
Brussels on behalf of the Syndicate to settle Part VII claims.
These funds are held at amortised cost in the balance sheet
Hiscox Syndicate 3624
Notes to the accounts
18
Hiscox Syndicates 3624 Report and Accounts 2025
3 Judgements and key sources of estimation uncertainty
In the application of the accounting policies, which are described
in note 2, the Directors are required to make judgements,
estimates and assumptions that affect the amounts reported for
assets and liabilities at the balance sheet date and the amounts
reported for revenues and expenses during the year.
The following judgements, estimations and assumptions have
had the most significant effect on amounts recognised in the
annual accounts.
3(a) Valuation of general insurance contract liabilities
The estimation of the ultimate liability arising from claims made
under insurance contracts is the Syndicate’s most critical
accounting estimate. The carrying amount of the liability is
disclosed in the technical provisions note 10. For general
insurance contracts estimates are made for the expected
ultimate cost of claims notified at the balance sheet date and
the cost of claims incurred but not yet reported. It can take a
significant period of time before the ultimate cost of claims can
be established with certainty, and the final outcome may be
better or worse than that provided. The estimation of these
claims is based on historical experience projected forward. The
Syndicate’s estimate of claims and expenses is mainly achieved
through the application of a number of commonly accepted
actuarial projection methodologies based on the following:
•
the development of previously paid claims, where
payments to date are extrapolated for each prior year;
•
the development of claims based on seasonally adjusted
exposure curves;
•
incurred claims development, where incurred claims to
date for each year are extrapolated based upon observed
development of earlier years; and
•
expected loss ratios.
The claims provisions are initially calculated gross of any
reinsurance recoveries. A separate estimate is made of the
amounts recoverable from the Syndicate’s reinsurance
arrangements including excess of loss and quota share
contracts, having due regard for collectability.
Claims provisions are subject to regular review, both within the
Syndicate and externally. Management discuss and challenge
the actuarial best estimate and booked claims provisions at the
quarterly Reserving Committee meeting, whose membership
includes Directors of the managing agent. External actuaries are
also engaged to calculate an independent best estimate of the
ultimate cost of claims at 31 December annually and present a
statement of actuarial opinion (SAO) against which the
Syndicate’s best estimate is assessed.
The Syndicate tests the adequacy of its unearned premium
liability by comparing current estimates of future claims and
claims handling expenses attributable to the unexpired periods
of policies at the balance sheet date which to the unearned
premium liability net of acquisition costs. As set out in note 2(e),
any deficiency is recognised in the income statement. The
related deferred acquisition costs are first written down and any
additional liability required is then recognised as an unexpired
risk reserve (URR).
3(b) Premium recognition
The gross premiums written are initially based on estimated
premium income (EPI) of each contract. EPI estimates are
based on information provided by brokers and coverholders, past
underwriting experience, the contractual terms of the policy and
prevailing market conditions. The EPI estimates are reviewed on
a regular basis, and premiums are adjusted over time as needed
to match the actual signed premium. Gross premiums written
under binding authorities are booked as the underlying contracts
incept. The Syndicate allocates the expected premium receipts
to each period of gross premiums written on the basis of the
passage of time. If the expected pattern of release of risk during
the coverage period differs significantly from the passage of time,
for example, a group of contracts that is exposed to large natural
catastrophe risk concentrated in the first or second half of the
year, then the allocation is made on the basis of the expected
timing of claims incurred. At a portfolio level this is considered to
provide a reasonable estimate for the full year of the pattern of
risk over the coverage period. Gross premiums written includes
an estimation for reinstatement premiums which is determined
based on incurred losses held in the technical provisions.
3(c) Fair value of financial instruments
The fair value of financial instruments that are not traded in an
active market is determined by using valuation techniques.
HSL uses judgement to select a variety of methods and make
assumptions that are mainly based on market conditions existing
at the end of each reporting period. See note 4 for discussion of
the related risks. See note 9 for an analysis of the measurement
attributes of the financial instruments.
4 Management of risk
The Syndicate’s overall appetite for accepting and managing
varying classes of risk is defined by the HSL Board. The HSL
Board has developed a governance framework and has set risk
management policies and procedures which include risk
identification, risk management and mitigation and risk reporting.
The objective of these policies and procedures is to protect the
Syndicate’s members, policyholders and other stakeholders
from negative events that could hinder the Syndicate’s delivery
of its contractual obligations and its achievement of sustainable
profitable economic and social performance.
The HSL Board exercises oversight of the development and
operational implementation of its risk management policies and
procedures through the HSL Risk Committee. Ongoing
compliance is monitored through an internal audit function,
shared with other Hiscox Ltd subsidiaries, which has operational
independence, a charter and clear upwards reporting structures
back into the HSL Audit Committee and HSL Board.
The Syndicate is fundamentally driven by a desire to originate,
retain and service insurance contracts to maturity. The
Syndicate’s cash flows are funded mainly through advance
premium collections and the timing of such premium inflows is
reasonably predictable.
In addition, the majority of material cash outflows are typically
triggered by the occurrence of insured events, although the
timing, frequency and severity of claims can fluctuate.
The principal sources of risk relevant to the Syndicate’s
operations and its annual accounts fall into five broad categories:
climate risk, insurance risk, financial risk, regulatory risk and
operational risk.
Hiscox Syndicate 3624
Notes to the accounts
Hiscox Syndicates 3624 Report and Accounts 2025
19
Operational risk
The Syndicate is exposed to the risk of direct or indirect loss
resulting from internal processes, people or systems, or from
external events. This includes cyber security risk as well as
major IT, systems or service failures. HSL actively monitors and
controls its operational risks. HSL demonstrated continued
resilience, underscoring the benefits of its business model,
disciplined risk management and ongoing investment in
technology and infrastructure. Hiscox has implemented
several operational risk management processes, which
include a continued focus on Group-wide crisis management
response planning and enhancing its defences and response
to information security and cyber threats. Hiscox regularly
reassesses its information security standards and methodologies
to ensure appropriate governance and consistency in its
approach. In 2024, we also introduced an artificial intelligence
(AI) standard to ensure we have appropriate governance and
controls around our own use of AI.
The Hiscox Group uses a governance, control and risk system
to perform the annual risk and control self assessment
exercise. It also enables more robust reporting and analysis of
operational risk events, driving greater insight and lessons learnt.
Our third-party suppliers are often crucial to our business,
enabling the delivery of high-quality service to our customers.
We have an established supplier code of conduct which sets
out the standards we expect our suppliers to operate to. Due
diligence is carried out not only as part of an initial sourcing
exercise but refreshed on an annual basis. We are investing
in supply chain management tools and processes which help
us better manage risk, including being part of the Financial
Services Qualification Scheme, utilising ESG ratings and
verification tooling.
Insurance risk
The predominant risk to which the Syndicate is exposed is
insurance risk which is assumed through the underwriting
process. Insurance risk can be subcategorised into:
(i) underwriting risk including the risk of catastrophe and
systemic insurance losses and the insurance cycle and
competition; and (ii) reserving risk.
(i) Underwriting risk
Underwriting risk is defined as the risk that insurance
premiums will not be sufficient to cover future insurance
losses and associated expenses. Underwriting risk also
encompasses people, process and system risks directly
related to underwriting.
The HSL Board sets the Syndicate’s underwriting strategy and
risk appetite, seeking to benefit from identified opportunities in
light of other relevant anticipated market conditions.
Specific underwriting objectives such as aggregation limits,
reinsurance protection thresholds, geographical disaster event
risk exposures and line of business diversification parameters
are prepared and reviewed by the HSL management team in
order to translate the HSL Board’s summarised underwriting
strategy into specific measurable actions and targets. These
actions and targets are reviewed and approved in advance of
each underwriting year. The HSL Board continually reviews its
underwriting strategy throughout each underwriting year in light
of evolving market pricing, loss conditions and as opportunities
present themselves.
The Syndicate’s underwriters and HSL management consider
underwriting risk at an individual contract level, and also from a
portfolio perspective where the risks assumed in similar classes
of policies are aggregated and the exposure evaluated in light of
historical portfolio experience and prospective factors. To assist
with the process of pricing and managing underwriting risk, the
Syndicate routinely performs a wide range of activities including
the following:
•
regularly updating the Syndicate’s risk models
•
documenting, monitoring and reporting against the
Syndicate’s strategy to manage risk;
•
developing systems that facilitate the identification of
emerging issues promptly;
•
utilising sophisticated computer modelling tools to simulate
catastrophes and measure the resultant potential losses
before and after reinsurance;
•
monitoring legal developments and amending the wording
of policies when necessary;
•
regular monitoring of risk exposures across individual
underwriting portfolios and known accumulations of risk;
•
examining the aggregated exposures in advance of
underwriting further large risks; and
•
developing processes that continually factor market
intelligence into the pricing process.
The delegation of underwriting authority to specific individuals,
both internally and externally, is subject to regular reviews. All
underwriting staff and binding agencies are set strict parameters
in relation to the levels and types of business they can
underwrite, based on individual levels of experience and
competence. These parameters cover areas such as maximum
sums insured per insurance contract, maximum gross premiums
written and maximum aggregated exposures per geographical
zone
and risk class. All delegations are strictly controlled
through these underwriting guidelines and limits and extensive
monitoring, review and auditing of the agencies. The Syndicate
compiles estimates of losses arising from realistic disaster events
using statistical models, alongside input from its underwriters.
They also represent areas of potentially significant exposure
for the Syndicate. In addition to understanding the loss the
Syndicate may suffer from an event, it is important to ensure
that the risk models used are calibrated to the risks faced today.
This includes recognising and forecasting inflationary trends,
updating trends in claims payments, and capturing climate
change-related impacts. HSL has a climate risk framework,
which is used to assess where research resources should be
focused, and models updated, and as a result improves not only
the Syndicate’s understanding of the potential impact of a
changing climate but also the Syndicate’s ability to respond.
The selection of extreme loss scenario events is adjusted
each year and they are not therefore necessarily directly
comparable from one year to the next. The events are extreme
and unprecedented, and as such estimates may prove
inadequate as a result of incorrect assumptions, model
deficiencies, or losses from unmodelled risks. This means that
should a realistic disaster actually occur, the Syndicate’s final
ultimate losses could materially differ from those estimates
modelled by management. The Syndicate’s insurance
contracts include provisions to contain losses, such as the
ability to impose deductibles and demand reinstatement
premiums in certain cases.
Hiscox Syndicate 3624
Notes to the accounts
20
Hiscox Syndicates 3624 Report and Accounts 2025
In addition, in order to manage the Syndicate’s exposure to
repeated catastrophic events (both man-made and natural
catastrophes), relevant policies frequently contain payment limits
to cap the maximum amount payable from these insured events
over the contract period. In the case of climate-exposed risks
specifically, the vast majority of underwriting contracts written
are annual in nature and thus can be revised frequently. This
flexibility is a key tool for managing the multi-decade challenge
of climate risks holistically.
The Syndicate also manages underwriting risk by purchasing
reinsurance. Reinsurance protection, such as excess of loss
cover, is purchased to mitigate the effect of catastrophes and
unexpected concentrations of risk. The scope and type of
reinsurance protection purchased may change depending on the
extent and competitiveness of cover available in the market. The
Syndicate is exposed to the risk that the reinsurance protection
that has been bought is inadequate or inappropriate, but this is
monitored and managed using modelling techniques, supervised
by a dedicated reinsurance purchase group. The specific
insurance risks accepted by the Syndicate are primarily specialty
lines, including Hiscox USA’s errors and omissions account,
written through Hiscox USA’s service company, Hiscox Inc.. This
business is written on a surplus lines basis. It also underwrites
smaller volumes of casualty and media, entertainment and
events where access to Lloyd’s licensing is required. The
Syndicate also considers climate change to be a cross-cutting
risk with potential to impact each existing risk type, rather than a
standalone risk. These specific categories are defined for risk
review purposes only, as each contains risks specific to the
nature of the cover provided. The following describes the policies
and procedures used to identify and measure the risks
associated with each individual category of business.
Casualty risks
The casualty underwriting strategy attempts to ensure that the
underwritten risks are well diversified in terms of type and amount of
potential hazard, industry and geography. However, the Syndicate’s
exposure is more focused towards professional, general, and
technological risks. Claims typically arise from incidents such as
errors and omissions attributed to the insured, professional
negligence and general liability losses which can be property
damage or bodily injury in nature. The provision of insurance to
cover allegations made against individuals acting in the course
of fiduciary or managerial responsibilities, including directors and
officers’ insurance, is one example of a casualty insurance risk.
The Syndicate’s casualty insurance contracts mainly experience
low-severity attritional losses. By nature, some casualty losses
may take longer to settle than other categories of business. In
addition, there is increased potential for accumulation in casualty
risk due to the growing complexity of business, technological
advances, and greater interconnectivity and interdependency
across the world due to globalisation.
The Syndicate’s pricing strategy for casualty insurance policies is
typically based on historical claim frequencies and average claim
severities, adjusted for inflation and extrapolated forwards to
incorporate projected changes in claims patterns. In determining
the price of each policy, an allowance is also made for
acquisition and administration expenses, reinsurance costs,
investment returns and the Syndicates’s cost of capital.
The market for cyber insurance is still a relatively immature one,
complicated by the fast-moving nature of the threat, as the world
becomes even more connected. The risks associated with cyber
insurance are multiplying in both diversity and scale, with
associated financial and reputational consequences of failing to
prepare for them. The Syndicate has focused its cyber expertise
on prevention, in addition to the more traditional recovery product.
(ii) Reserving risk
Reserving risk is defined as the risk that reserves set, in respect of
insurance claim losses, are ultimately insufficient to fully settle these
claims and associated expenses. This definition also applies to
reserves which have been set previously. The Syndicate’s
procedures for estimating the outstanding costs of settling insured
losses at the balance sheet date, including claims incurred but not
yet reported, are detailed in note 3(a). The Syndicate’s provision
estimates are subject to regular and rigorous review by senior
management from all areas of the business. The auditors provide an
external review of the reserves together with an independent
actuarial opinion. The final provision is approved by the HSL Board.
Similar to the underwriting risk detailed above, the Syndicate’s
reserve risks are well diversified. Short-tailed claims are
normally notified and settled within 12-to-24 months of the
insured event occurring. Those claims taking the longest time
to develop and settle typically relate to casualty risks, where
legal complexities occasionally develop regarding the insured’s
alleged omissions or negligence. The length of time required to
obtain definitive legal judgments and make eventual settlements
exposes the Syndicate to a degree of reserving risk in an
inflationary environment.
The final quantum for casualty claims may not be established
for many years after the event. A significant proportion of the
casualty insurance amounts reserved on the balance sheet may
not be expected to settle within 24 months of the balance sheet
date. Consequently, our approach is not to recognise favourable
experience in the early years of development in the reserving
process when setting the booked reserve.
In addressing the impact of inflation HSL focuses on:
•
regular case reserve reviews to ensure adequacy;
•
uplifts to incurred but not reported (IBNR) reserves to allow
for current and future expectations of high inflation rates;
•
assessment of rate increases against future inflation to
assess loss ratio impacts.
The Syndicate maintains explicit reserve uplifts to allow for the
impact of high inflation in recent years. Loss ratios are closely
monitored to ensure they include an appropriate allowance for
future inflation.
Booked reserves include a net margin of $38.4 million (2024:
$33.1 million), representing 7.5% (2024: 6.7%) of net booked
reserves. This is the margin above the best estimate to help
mitigate the uncertainty within the reserve estimates. As the best
estimate matures and becomes more certain, the management
margin is gradually released in line with the reserving policy.
The liabilities established could be significantly lower or higher
than the ultimate cost of settling the claims arising. This level
of uncertainty varies between the classes of business and
the nature of the risk being underwritten and can arise from
developments in case reserving for large losses and
catastrophes, or from changes in estimates of claims IBNR.
Hiscox Syndicate 3624
Notes to the accounts
Hiscox Syndicates 3624 Report and Accounts 2025
21
Table (a) 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.
Table (a)
General insurance business sensitivities as at 31 December 2025
2.5 %
(2.5)%
5.0 %
(5.0)%
$000
$000
$000
$000
Claims outstanding - gross of reinsurance
17,373
(17,373)
(34,746 )
Claims outstanding - net of reinsurance
12,271
(12,271)
(24,543 )
General insurance business sensitivities as at 31 December 2024
2.5 %
(2.5)%
5.0 %
(5.0)%
$000
$000
$000
$000
Claims outstanding - gross of reinsurance
19,023
(19,023)
(38,046 )
Claims outstanding - net of reinsurance
11,956
(11,956)
(23,912 )
Financial risk
The Syndicate is exposed to financial risk through its ownership
of financial instruments including financial liabilities. The
Syndicate invests in financial assets in order to fund obligations
arising from its insurance contracts and other liabilities.
The key financial risk for the Syndicate is that the proceeds from
its financial assets and investment result generated thereon are
not sufficient to fund the obligations.
The most important variables that could result in such an
outcome relate to the interest rate risk, credit risk, liquidity risk
and currency risk.
The Syndicate’s policies and procedures for managing exposure
to these specific categories of risk are detailed below.
(a) Reliability of fair values
The Syndicate has elected to carry all financial investments at fair
value through profit or loss as they are managed and evaluated
on a fair value basis in accordance with a documented strategy.
All of the financial investments held by the Syndicate are
available to trade in markets and the Syndicate therefore seeks
to determine fair value by reference to published prices or as
derived by pricing vendors using observable quotations in the
most active financial markets in which the assets trade.
The fair value of financial assets is measured primarily with
reference to their closing bid-market prices at the balance sheet
date. The ability to obtain quoted bid-market prices may be
reduced in periods of diminished liquidity. In addition, those
quoted prices that may be available may represent an unrealistic
proportion of market holdings or individual trade sizes that could
not be readily available to the Syndicate. In such instances, fair
values may be determined or partially supplemented using other
observable market inputs such as prices provided by market
makers such as dealers and brokers and prices achieved in the
most recent regular transaction of identical or closely-related
instruments occurring before the balance sheet date but
updated for relevant perceived changes in market conditions.
At 31 December 2025, the Syndicate held mortgage backed fixed
income securities in its investment portfolio. Together with the
Syndicate’s investment managers, management continues to
monitor the potential for any adverse development associated with
this investment exposure through the analysis of relevant factors
such as credit ratings, collateral, subordination levels and default
rates in relation to the securities held.
The Syndicate did not experience any material defaults on debt
securities during the year.
Valuation of these securities will continue to be impacted by external
market factors including default rates, rating agency actions and
liquidity. The Syndicate will make adjustments to the investment
portfolio as appropriate as part of its overall portfolio strategy, but its
ability to mitigate its risk by selling or hedging its exposures may be
limited by the market environment. The Syndicate’s future results
may be impacted, both positively and negatively, by the valuation
adjustments applied to these securities.
(b) Interest rate risk
Debt and fixed income investments represent a significant
proportion of the Syndicate’s assets and the HSL Board
continually monitors investment strategy to minimise the risk of a
fall in the portfolio’s market value which could affect the amount
of business that the Syndicate is able to underwrite or its ability
to settle claims as they fall due. The fair value of the Syndicate’s
investment portfolio of debt and fixed income securities is
normally inversely correlated to movements in market interest
rates. If market interest rates rise, the fair value of the
Syndicate’s debt and fixed income investments would tend to
fall and vice-versa if credit spreads remained constant. The
Syndicate may also, from time to time, enter into interest rate
future contracts in order to minimise the interest rate risk. The
fair value of debt and fixed income assets in the Syndicate’s
balance sheet at 31 December is analysed below:
Table b)
31 December
2025
31 December
2024
% weightage
% weightage
Government issued bonds and instruments
14
22
Asset backed securities
9
—
Mortgage backed instruments – agency
3
—
Mortgage backed securities – non agency
12
—
Corporate bonds
62
78
Hiscox Syndicate 3624
Notes to the accounts
22
Hiscox Syndicates 3624 Report and Accounts 2025
The sensitivity analysis for interest rate risk illustrates how
changes in the fair value or future cash flows of a financial
instrument will fluctuate because of changes in market interest
rates at the reporting date. The impact of an increase or
decrease of 50 basis points in interest yields is shown in the
table below. Insurance contract liabilities are not directly sensitive
to the level of market interest rates, as they are undiscounted
and contractually non-interest-bearing.
Table (c)
Interest rate risk
2025 impact
on profit
2025 impact
on members'
balance
2024 impact
on profit
2024 impact
on members'
balance
$000
$000
$000
$000
Plus 50 basis points shift
in yield curves
(6,930 ) (6,930 )
(6,663 ) (6,663 )
Minus 50 basis points
shift in yield curves
(c) Credit risk
The Syndicate has exposure to credit risk, which is the risk that
a counterparty will suffer a deterioration in actual or perceived
financial strength and be unable to pay amounts in full when
due, or that for any other reason they renege on a contract or
alter the terms of an agreement.
The concentrations of credit risk exposures held by insurers may
be expected to be greater than those associated with other
industries, due to the specific nature of reinsurance markets and
the extent of investments held in financial markets. In both
markets, the Syndicate interacts with a number of counterparties
who are engaged in similar activities with similar customer
profiles, and often in the same geographical areas and industry
sectors. Consequently, as many of these counterparties are
themselves exposed to similar economic characteristics, one
single localised or macroeconomic change could severely
disrupt the ability of a significant number of counterparties to
meet the Syndicate’s agreed contractual terms and conditions.
Key areas of exposure to credit risk include:
•
reinsurers’ share of insurance liabilities;
•
amounts due from reinsurers in respect of claims
already paid;
•
amounts due from insurance contract holders
•
amounts due from insurance intermediaries; and
•
counterparty risk with respect to cash and cash
equivalents, and investments and other deposits
including deposits and derivative transactions.
The Syndicate’s maximum exposure to credit risk is represented
by the carrying values of monetary assets and reinsurance assets
included in the balance sheet at any given point in time. The
Syndicate does not use credit derivatives or other products to
mitigate maximum credit risk exposures on reinsurance assets,
but collateral may be requested to be held against these assets.
The Syndicate structures the levels of credit risk accepted by
placing limits on their exposure to a single counterparty, or
groups of counterparties, and having regard to geographical
locations. Such risks are subject to an annual or more frequent
review. There is no significant concentration of credit risk with
respect to loans and receivables, as the Syndicate has a large
number of internationally dispersed debtors with unrelated
operations. Reinsurance is used to contain insurance risk.
This does not, however, discharge the Syndicate’s liability as
primary insurer. If a reinsurer fails to pay a claim for any reason,
the Syndicate remains liable for the payment to the policyholder.
The creditworthiness of reinsurers is therefore continually
reviewed throughout the year.
The managing agent assesses the creditworthiness of all
reinsurers by reviewing credit grades provided by rating agencies
and other publicly available financial information detailing their
financial strength and performance. The financial analysis of
reinsurers produces an assessment categorised by S&P rating
(or equivalent when not available from S&P).
Despite the rigorous nature of this assessment exercise, and
the resultant restricted range of reinsurance counterparties
with acceptable strength and credit credentials that
emerges therefrom, some degree of credit risk concentration
remains inevitable.
While the rating agencies provide strong analysis on the
financials and governance of a reinsurance security, the HSL
Board also takes account of qualitative factors. The HSL Board
considers the reputation of its reinsurance partners and also
receives details of recent payment history and the status of any
ongoing negotiations between other Hiscox entities and these
third parties. The final score that a security receives will
determine how much reinsurance credit risk the Syndicate is
willing to have with that security based on the exposure
guidelines. This information is used to update the reinsurance
purchasing strategy. Individual operating units maintain records
of the payment history for significant brokers and contract
holders with whom they conduct regular business
.
The exposure to individual counterparties is also managed
by other mechanisms, such as the right of offset, where
counterparties are both debtors and creditors of the
Syndicate, and obtaining collateral from unrated counterparties.
Management information reports detail provisions for impairment
on loans and receivables and subsequent write-off. Exposures
to individual intermediaries and groups of intermediaries are
collected within the ongoing monitoring of the controls
associated with regulatory solvency.The Syndicate also mitigates
counterparty credit risk by concentrating debt and fixed income
investments in a portfolio of typically high-quality corporate and
government bonds.
Hiscox Syndicate 3624
Notes to the accounts
Hiscox Syndicates 3624 Report and Accounts 2025
23
An analysis of the Syndicate’s major exposures to counterparty credit risk excluding direct policyholder debtors, based on S&P or
equivalent rating at 31 December, is presented in the table below:
Table d)
At 31 December 2025
AAA
AA
A
BBB
Other
Not rated
Total
$000
$000
$000
$000
$000
$000
$000
Debt securities and other fixed income securities
Shares and other variable yield securities and units in
unit trusts
Syndicate loans to central fund
Derivative assets
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 and accrued interest
Total
At 31 December 2024
AAA
AA
A
BBB
Other
Not rated
Total
$000
$000
$000
$000
$000
$000
$000
Debt securities and other fixed income securities
Shares and other variable yield securities and units in
unit trusts
Syndicate loans to central fund
Derivative assets
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 and accrued interest
Total
Within the financial investments, which include debt securities and other fixed income securities, shares and other variable yield securities
and units in unit trusts,
syndicate loans to central fund and cash equivalent assets, there are exposures to a range of government
borrowers, on either a direct or guaranteed basis, and banking institutions. The Syndicate, together with its investment managers,
closely manages its geographical exposures across government issued and supported debt.
At 31 December 2025 and 2024, the Syndicate held no material debt or fixed income assets that were past due or impaired beyond
their reported fair values. For the current and prior year, the Syndicate did not experience any material defaults on debt securities.
Hiscox Syndicate 3624
Notes to the accounts
24
Hiscox Syndicates 3624 Report and Accounts 2025
(d) Financial assets that are due or impaired
The Syndicate has no debtors that are impaired at the reporting date. 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:
Table (e)
At 31 December 2025
Neither past due
nor impaired
assets
Past due but not
impaired assets
Gross value of
impaired assets
Impairment
allowance
Total
$000
$000
$000
$000
$000
Debt securities and other fixed income securities
—
Shares and other variable yield securities and units in unit trusts
—
Syndicate loans to central fund
—
Derivative assets
—
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 and accrued interest
—
Total
—
At 31 December 2024
Neither past due
nor impaired assets
Past due but not
impaired assets
Gross value of
impaired assets
Impairment
allowance
Total
$000
$000
$000
$000
$000
Debt securities and other fixed income securities
—
Shares and other variable yield securities and units in unit trusts
—
Syndicate loans to central fund
—
Derivative assets
—
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 and accrued interest
—
Total
—
Hiscox Syndicate 3624
Notes to the accounts
Hiscox Syndicates 3624 Report and Accounts 2025
25
(e) Liquidity risk
The Syndicate is exposed to daily calls on its available cash resources, mainly from claims arising from insurance and reinsurance
contracts. Liquidity risk is the risk of being unable to meet customer or other third-party payment obligations from available
resources as they fall due. This could result in higher than expected costs in selling assets or raising money quickly to meet
our obligations.
The HSL Board sets limits on the minimum level of cash and maturing funds available to meet such calls and on the minimum level
of borrowing facilities that should be in place to cover unexpected levels of claims and other cash demands.
A significant proportion of the Syndicate’s investments is in highly-liquid assets which could be converted to cash in a prompt
fashion and at minimal expense. The deposits with credit institutions largely comprise short-dated certificates for which an active
market exists and which the Syndicate can easily access.
The main focus of the investment portfolio is on high-quality, short-duration debt and fixed income securities, and cash. There
are no significant holdings of investments with specific repricing dates. Notwithstanding the regular interest receipts and also the
Syndicate’s ability to liquidate these securities and the majority of its other financial instrument assets for cash in a prompt and
reasonable manner, the contractual maturity profile of the financial assets and financial liabilities at 31 December was as follows:
Table (f)
At 31 December 2025
Less than one year
Between one and
three years
Between three and
five years
Over five years
Total
$000
$000
$000
$000
$000
Investments
61,770
292,699
242,485
76,793
673,747
Reinsurers’ share of claims outstanding
107,157
46,232
29,138
21,540
204,067
Debtors
32,928
2,231
—
—
35,159
Cash at bank and in hand
7,289
—
—
—
7,289
Accrued interest
5,629
—
—
—
5,629
Other prepayments and accrued income
98
—
—
—
98
Claims outstanding
(314,873 )
(237,640 )
(96,924 )
(45,487 )
(694,924 )
Creditors
(25,587 )
(41,847 )
(8,844 )
(2 )
(76,280 )
Derivative liabilities
(614 )
(614 )
Accruals and deferred income
(1,665)
—
—
—
(1,665)
Total
(127,868 )
At 31 December 2024
Less than one year
Between one and
three years
Between three and
five years
Over five years
Total
$000
$000
$000
$000
$000
Investments
145,245
325,597
221,896
5,552
698,290
Reinsurers’ share of claims outstanding
124,355
101,234
29,686
27,398
282,673
Debtors
38,538
2,682
—
—
41,220
Cash at bank and in hand
7,765
—
—
—
7,765
Accrued interest
6,085
—
—
—
6,085
Other prepayments and accrued income
4
—
—
—
4
Claims outstanding
(313,332 )
(295,961 )
(100,526 )
(51,093 )
(760,912 )
Creditors
(36,025 )
(78,260 )
(17,179 )
(131,464 )
Derivative liabilities
Accruals and deferred income
(326)
—
—
—
(326)
Total
(27,691 )
(18,143 )
The available headroom of working capital is monitored through the use of a detailed Syndicate cash flow forecast which is reviewed
by management quarterly, or more frequently, as required.
A significant proportion of the financial investments are in highly liquid assets which could be converted to cash in a prompt fashion
and at minimal expense to settle Syndicate liabilities as they fall due. The Directors have a reasonable expectation that the Syndicate
has adequate resources to continue in operation for the foreseeable future.
Hiscox Syndicate 3624
Notes to the accounts
26
Hiscox Syndicates 3624 Report and Accounts 2025
Average contractual maturity analysed by denominated currency of investments was as follows:
Table g)
At 31 December 2025
2025
2024
In years
In years
Sterling
1.9
0.2
US Dollar
3.4
2.5
Euro
—
—
Canadian Dollar
1.6
2.0
The majority of the Syndicate’s gross premiums written is in US Dollars, consequently movements in Sterling, Euro and Canadian
Dollar against US Dollar exchange rate may have a material effect on its financial performance and position. The Syndicate’s financial
assets are denominated in the same currencies as its insurance liabilities, in order to reduce currency exchange volatility from the
balance sheet. This profit and loss is distributed in accordance with Lloyd’s rules using a combination of Sterling and US Dollars.
The currency profile of the Syndicate’s financial assets and financial liabilities is as follows:
Table h)
At 31 December 2025
US Dollar
Sterling
Euro
Canadian Dollar
Total
$000
$000
$000
$000
$000
Investments
Reinsurers share of technical provisions
(5,314 )
Debtors
(1,298 )
Other assets
(13,891 )
(5,313 )
Prepayments and accrued income
Total assets
(1,723 )
Technical provisions
(767,411 )
(30,130 )
(7,711 )
(673 )
(805,925 )
Creditors
(96,680 )
(8,513 )
(76,894 )
Accrued and deferred income
(114 )
(1,536 )
(15 )
(1,665 )
Total liabilities
(864,205 )
(6,279 )
(16,239 )
(884,484 )
Members balances by currency
(68,730 )
(17,236 )
(516 )
(85,681 )
At 31 December 2024
US Dollar
Sterling
Euro
Canadian Dollar
Total
$000
$000
$000
$000
$000
Investments
Reinsurers share of technical provisions
(1,386 )
Debtors
(1,026 )
Other assets
(24,844 )
(8,176 )
Prepayments and accrued income
Total assets
(549 )
Technical provisions
(830,245 )
(32,097 )
(7,802 )
(2,409 )
(872,553 )
Creditors
(140,760 )
(10,171 )
(131,464 )
Accrued and deferred income
(85 )
(225 )
(16 )
(326 )
Total liabilities
(971,090 )
(15,482 )
(17,989 )
(1,004,343 )
Members balances by currency
(62,360 )
(12,048 )
(1,297 )
(75,374 )
Hiscox Syndicate 3624
Notes to the accounts
Hiscox Syndicates 3624 Report and Accounts 2025
27
Sensitivity analysis
The Syndicate performs sensitivity analysis based on a 10% strengthening or weakening of the US Dollar against Sterling, Euro
and the Canadian Dollar. This analysis assumes that all other variables, in particular interest rates, remain constant and that the
underlying valuation of assets and liabilities in their base currency is unchanged. During the year, the Syndicate transacted in a
number of over-the-counter forward currency derivative contracts. The impact of these contracts on the sensitivity analysis is
negligible. The impact of a 10% increase or decrease against the following currencies is shown in the table below:
Table i)
Currency risk
2025 impact on
profit
2025 impact on
members' balance
2024 impact on
profit
2024 impact on
members' balance
$000
$000
$000
$000
Ten percent increase in US Dollar/Sterling exchange rate
(1,724)
1,724
(1,205)
1,205
Ten percent decrease in US Dollar/Sterling exchange rate
1,724
(1,724)
1,205
(1,205)
Ten percent increase in US Dollar/Euro exchange rate
80
(80)
(130)
130
Ten percent decrease in US Dollar/Euro exchange rate
(80)
80
130
(130)
Ten percent increase in US Dollar/Canadian Dollar exchange rate
(52)
52
33
(33)
Ten percent decrease in US Dollar/Canadian Dollar exchange rate
52
(52)
(33)
33
Regulatory risk
The managing agent is required to comply with the requirements of the Prudential Regulation Authority, Financial Conduct Authority
and Lloyd’s. Lloyd’s requirements include those imposed on the Lloyd’s market by overseas regulators, particularly in respect of
US situs business. Regulatory risk is the risk of loss owing to a breach of regulatory requirements or failure to respond to regulatory
change. HSL devotes considerable resources to meet its regulatory obligations, including compliance, risk management and internal
audit functions.
Climate risk
Climate risk relates to the range of complex physical, transition and liability risks arising from climate change. This includes the risk
of higher claims as a result of more frequent and more intense natural catastrophes; the financial risks which could arise from the
transition to a lower-carbon economy; and the risk that those who have suffered loss from climate change might then seek to
recover those losses from others who they believe may have been responsible. Climate-related risk is not considered a standalone
risk, but a cross-cutting risk with potential to amplify each existing risk type. A transition plan is being developed which will consider
in more detail the transition risk associated with our portfolios.
By design, the established and embedded HSL risk management framework provides a controlled and consistent system for the
identification, measurement, mitigation, monitoring and reporting of risks (both current and emerging) and so is structured in a way
that allows us to continually and consistently manage the various impacts of climate risk on the risk profile. This is supported by a
Group wide sustainability strategy and equally robust processes and policies that address climate-related underwriting risks, such as
the Group’s environmental, social and governance (ESG) exclusions policy which applies to HSL and represents a commitment to
reduce steadily and eliminate by 2030 both underwriting and investment exposure to coal-fired power plants and coal mines; Arctic
energy exploration, beginning with the Arctic National Wildlife Refuge; oil sands; and controversial weapons such as landmines.
We also consider the training and development requirements of those with oversight responsibilities and accountability for climate
matters to ensure we have appropriate awareness and expertise to drive progress. In 2025, this included a Board-level training
session which aims to enhance the Board’s awareness and knowledge of transition planning, and Hiscox’s requirement to publish
a transition plan. More information can be in located in our Task Force on Climate-related Financial Disclosure (TCFD) report in the
ultimate Group Annual Report and Accounts of Hiscox Ltd.
Capital management
The Syndicate’s objectives in managing its capital are to:
•
satisfy the requirements of its policyholders and regulators; and
•
allocate capital efficiently to support strategic objectives.
Capital framework at Lloyd’s
The Society of Lloyd’s (Lloyd’s) is a regulated undertaking and subject to the supervision of the Prudential Regulatory Authority (PRA)
under the Financial Services and Markets Act 2000 and in accordance with Solvency UK legislation. Within this supervisory
framework, Lloyd’s applies capital requirements at member level and centrally to ensure that Lloyd’s complies with Solvency UK,
and beyond that to meet its own financial strength, licence and ratings objectives. Although, as described below, Lloyd’s capital
setting processes use a capital requirement set at syndicate level as a starting point, the requirement to meet Solvency UK and
Lloyd’s capital requirements applies at overall and member level respectively, not at syndicate level. Accordingly, the capital
requirement is not disclosed in these annual accounts.
Hiscox Syndicate 3624
Notes to the accounts
28
Hiscox Syndicates 3624 Report and Accounts 2025
Lloyd’s capital setting process
In order to meet Lloyd’s requirements, each syndicate is required to calculate its solvency capital requirement (SCR) for the
prospective underwriting year. This amount must be sufficient to cover a one-in-200-year loss, reflecting uncertainty in the ultimate
run-off of underwriting liabilities (SCR ‘to ultimate’). The syndicate must also calculate its SCR at the same confidence level but
reflecting uncertainty over a one-year time horizon (one year SCR) for Lloyd’s to use in meeting Solvency UK requirements. The
SCRs of each syndicate are subject to review by Lloyd’s and approval by the Lloyd’s Capital and Planning Group. A syndicate may
be comprised of one or more underwriting members of Lloyd’s. Each member is liable for its own share of underwriting liabilities on
the syndicate(s) on which it participates but not other members’ shares. Accordingly, the capital requirement that Lloyd’s sets for
each member operates on a similar basis. Each member’s SCR shall thus be determined by the sum of the member’s share of the
syndicate SCR ‘to ultimate’. Where a member participates on more than one syndicate, a credit for diversification is provided to
reflect the spread of risk, but consistent with determining an SCR which reflects the capital requirement to cover a one-in-200-year
loss ‘to ultimate’ for that member. Over and above this, Lloyd’s applies a capital uplift to the member’s SCR requirement, and the
resulting capital is known as the economic capital assessment (ECA). The purpose of this uplift, which is a Lloyd’s not a Solvency UK
requirement, is to meet Lloyd’s financial strength, licence and ratings objectives. The capital uplift applied for 2025 was 35% of the
member’s SCR ‘to ultimate’.
Provision of capital by members
Each member may provide capital to meet its ECA either by assets held in trust by Lloyd’s specifically for that member (funds at
Lloyd’s), held within and managed within a syndicate (funds in syndicate) or as the member’s share of the members’ balances on each
syndicate on which it participates. The level of FAL/FIS that Lloyd’s requires a member to maintain is determined by Lloyd’s based on
PRA requirements and resource criteria. This capital requirement is based on a number of factors including the nature and amount of
risk to be underwritten by the member and the assessment of the reserving risk in respect of business that has been underwritten.
Resources available to meet members’ and Lloyd’s capital requirements are separately identified in the statement of changes in
members’ balances. Lloyd’s also retains the right to request a callable contribution of up to 5% of capacity from the Syndicate.
5 Segmental analysis
An analysis of the underwriting result before investment return is set out below:
Year ended 31 December 2025
Gross premiums
written
Gross premiums
earned
Gross claims
incurred
Net operating
expenses
Reinsurance
balance
Underwriting result
$000
$000
$000
$000
$000
$000
Accident and health
(2 )
(331 )
Motor - third-party liability
Motor - other classes
(457 )
(113 )
(456 )
Marine aviation and transport
(15 )
(15 )
(1,225 )
(942 )
(1,112 )
Fire and other damage to property
(1,447 )
(1,108 )
Third party liability
(96,066 )
(16,609 )
Credit and suretyship
(476 )
(621 )
(1,762 )
(1,337 )
Total direct insurance
(99,516 )
(14,036 )
Reinsurance
(823 )
(408 )
(257 )
(731 )
Total
(99,924 )
(14,293 )
The below is an additional disclosure for Lloyd’s reporting purposes and is included to facilitate the classification of the above
segments into the Lloyd’s aggregate classes of business:
Year ended 31 December 2025
Gross premiums
written
Gross premiums
earned
Gross claims
incurred
Net operating
expenses
Reinsurance
balance
Underwriting result
$000
$000
$000
$000
$000
$000
Fire and other damage to property of which is:
Specialities
(133 )
(1,221 )
Energy
Third-party liability of which is:
Energy
Hiscox Syndicate 3624
Notes to the accounts
Hiscox Syndicates 3624 Report and Accounts 2025
29
Year ended 31 December 2024
Gross premiums
written
Gross premiums
earned
Gross claims
incurred
Net operating
expenses
Reinsurance
balance
Underwriting result
$000
$000
$000
$000
$000
$000
Accident and health
(2 )
(86 )
(2 )
Motor - third-party liability
(98 )
(98 )
(320 )
(4 )
(73 )
Motor - other classes
(70 )
(1,183 )
(65 )
Marine aviation and transport
(1,896 )
(127 )
(494 )
Fire and other damage to property
(1,296 )
(1,852 )
Third party liability
(93,027 )
Credit and suretyship
(711 )
(5,106 )
Total direct insurance
(95,237 )
(1,526 )
Reinsurance
(600 )
(6,076 )
Total
(95,837 )
(7,602 )
The below is an additional disclosure for Lloyd’s reporting purposes and is included to facilitate the classification of the above
segments into the Lloyd’s aggregate classes of business:
Year ended 31 December 2024
Gross premiums
written
Gross premiums
earned
Gross claims
incurred
Net operating
expenses
Reinsurance
balance
Underwriting result
$000
$000
$000
$000
$000
$000
Fire and other damage to property of which is:
Specialities
(69 )
(851 )
Energy
Third-party liability of which is:
Energy
All premiums were concluded in the UK. The geographical analysis of direct insurance gross premiums written by destination as a
proxy for risk location, is as follows:
2025
2024
$000
$000
United Kingdom
European Union Member States
United States
Rest of the world
Total
6 Net operating expenses
2025
2024
$000
$000
Acquisition costs
Change in deferred acquisition costs
(760 )
Administrative expenses
Members' standard personal expenses
Reinsurers’ commissions and profit participations
(521 )
(635 )
Total
Brokerage and commissions on direct business written was $81.5 million (2024: $81.2 million). Administrative expenses include fees
payable to the auditors and its associates (exclusive of VAT).
2025
2024
$000
$000
Auditors' remuneration
Fees payable to the Syndicate’s auditors for audit of the syndicate annual
accounts
Fees payable to the Syndicate’s auditors and its associates in respect of other services pursuant to legislation
Total auditors’ remuneration expense
466
432
Hiscox Syndicate 3624
Notes to the accounts
30
Hiscox Syndicates 3624 Report and Accounts 2025
7 Staff numbers and costs
The Syndicate and its managing agent have no employees. Staff are employed by Hiscox Underwriting Group Services Limited
(HUGS). The average number of persons employed by HUGS, but working for the Syndicate during the year, analysed by category,
was as follows:
2025
2024
Administration and finance
Underwriting
Claims
Investments
Total
The Syndicate did not directly incur staff costs during the year (2024: nil). The following salary and related costs were recharged
during the year:
2025
2024
$000
$000
Wages and salaries
Social security costs
Other pension costs
Total
The Directors of Hiscox Syndicates Limited received the following aggregate remuneration charged to the Syndicate and included
within net operating expenses:
2025
2024
$000
$000
Directors'
emoluments
The active underwriters received the following remuneration charged as a Syndicate expense.
2025
2024
$000
$000
Underwriter emoluments
8 Investment Return
2025
2024
$000
$000
Interest and similar income
From financial assets designated at fair value through profit or loss:
Interest income on financial assets
Other income from investments
From financial assets designated at fair value through profit or loss:
Gains on realisation of investments
Losses on realisation of investments
(577 )
(3,130 )
Unrealised gains on investments
Unrealised losses on the investments
(6,354 )
(3,524 )
Investment management expenses
(429 )
(558 )
Total investment return
Transferred to the technical account from the non
-
technical account
Hiscox Syndicate 3624
Notes to the accounts
Hiscox Syndicates 3624 Report and Accounts 2025
31
The tables below present the average amounts of funds in the year per currency and the average investment return yields
in the year.
2025
2024
$000
$000
Average amount of syndicate funds available for investment during the year
Sterling
11,889
12,826
Euro
4,424
4,820
US Dollar
668,904
685,480
Canadian Dollar
6,039
8,557
Total syndicate funds available for investment
691,256
711,683
2025
2024
%
%
Annual Investment yield
Sterling
3.1
6.5
Euro
2.2
3.6
US Dollar
5.9
4.9
Canadian Dollar
3.7
6.1
Total annual investment yield percentage
5.8
5.0
Syndicate funds include investments and cash. Annual investment yield excludes investment management charges.
9 Financial investments
2025
2025
2024
2024
carrying value
cost
carrying value
cost
$000
$000
$000
$000
Debt securities and other fixed income securities
Shares and other variable yield securities and units in unit trusts
Syndicate loans to central fund
Derivative financial assets
Loans and deposits with credit institutions
Total financial investments
All financial investments in the current and prior financial year were carried at fair value through profit or loss. No financial assets in
the current or prior financial year were classified as ‘held for trading’ under FRS 102. 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
Financial assets measured at amortised cost
Total financial investments
Other financial assets under FRS 102 are cash at bank and in hand, direct insurance and reinsurance debtors, other debtors and
accrued income, which are classified as debtors.
Fair value hierarchy
The Syndicate has classified its financial investments using the fair value hierarchy in accordance with the FRS 102.
The levels within the fair value hierarchy are defined as follows:
•
level 1 – the unadjusted quoted price in an active market for identical assets or liabilities that the entity can access at the
measurement date;
•
level 2 – inputs other than quoted prices included within level 1 that are observable (i.e. developed using market data) for the
asset or liability, either directly or indirectly; and
•
level 3 – inputs are unobservable (i.e. for which market data is unavailable) for the asset or liability.
Hiscox Syndicate 3624
Notes to the accounts
32
Hiscox Syndicates 3624 Report and Accounts 2025
2025
Level 1
Level 2
Level 3
Assets held at
amortised cost
Total
$000
$000
$000
$000
$000
Debt securities and other fixed income securities
Shares and other variable yield securities and units in unit trusts
Syndicate loans to central fund
Derivative financial assets
Total financial investments
Total
2024
Level 1
Level 2
Level 3
Assets held at
amortised cost
Total
$000
$000
$000
$000
$000
Debt securities and other fixed income securities
Shares and other variable yield securities and units in unit trusts
Syndicate loans to central fund
Derivative financial assets
Total financial investments
Total
The following table sets forth a reconciliation of opening and closing balances for financial instruments classified under level 3 of the
fair value hierarchy:
2025
2024
$000
$000
Balance at 1 January
4,489
5,690
Fair value gains through profit or loss
171
220
Foreign exchange gains or (losses)
206
(85)
Purchases
—
—
Settlements
(4,866)
(1,336)
Balance at 31 December
—
4,489
Unrealised gains in the year on securities held at the end of the year
171
220
The Syndicate measures the fair value of its financial assets based on prices provided by custodians who obtain market data from
numerous independent pricing services. The pricing services used by the custodian obtain actual transaction prices for securities
that have quoted prices in active markets. For those securities which are not actively traded, the pricing service uses common
market valuation pricing models. Observable inputs used in common market valuation pricing models include, but are not limited to,
broker quotes, credit ratings, interest rates and yield curves, prepayment speeds, default rates and other such inputs which are
available from market sources.
2025
Gross contract
notional amount
Fair value of
assets
Fair value of
liabilities
Net balance sheet
position
asset/liability
$000
$000
$000
$000
Forward exchange forward contracts
91
(614)
(523 )
2024
Gross contract
notional amount
Fair value of
assets
Fair value of
liabilities
Net balance sheet
position
asset/liability
$000
$000
$000
$000
Forward exchange forward contracts
—
—
Foreign exchange forwards
During 2025 and 2024, the Syndicate entered into a series of conventional forward contracts in order to avoid exchange volatility on
Sterling and Euro denominated monetary assets. The contracts required the Syndicate to forward sell a fixed amount of Sterling and
Euros for US Dollars at pre-agreed exchange rates. The investment return in 2025 and 2024 on these foreign exchange forwards is
disclosed in note 8.
Hiscox Syndicate 3624
Notes to the accounts
Hiscox Syndicates 3624 Report and Accounts 2025
33
10 Technical provisions
2025
Gross
provisions
Reinsurance
assets
Net
$000
$000
$000
Claims outstanding:
Balance at 1 January
Over/under provision in respect of prior claims and claim adjustment expenses
(17,228 )
(3,672 )
Expected cost of current year claims
(1,931 )
Claims paid for claims settled in year
(177,333 )
Effect of movements in exchange rates
(1,324 )
Balance at 31 December
Claims reported and claims adjustment expenses
269,576 (101,159)
168,417
Claims incurred but not reported
425,348 (102,908)
322,440
Balance at 31 December
694,924 (204,067)
490,857
Unearned premiums:
Balance at 1 January
(3,847 )
Premiums written during the year
(2,211 )
Premiums earned during the year
(233,281 )
Effect of movements in exchange rates
(43 )
Balance at 31 December
(3,433 )
Deferred acquisition costs:
Balance at 1 January
(242 )
Acquisition costs written
(469 )
Acquisition costs earned
(81,703 )
(81,182 )
Effect of movements in exchange rates
(17 )
Balance at 31 December
(207 )
Hiscox Syndicate 3624
Notes to the accounts
34
Hiscox Syndicates 3624 Report and Accounts 2025
2024
Gross
provisions
Reinsurance
assets
Total
$000
$000
$000
Claims outstanding:
Balance at 1 January
Over/under provision in respect of prior claims and claim adjustment expenses
(11,536 )
(9,264 )
Expected cost of current year claims
(4,045 )
Claims paid for claims settled in year
(230,908 )
Effect of movements in exchange rates
(1,413 )
(674 )
Balance at 31 December
Claims reported and claims adjustment expenses
303,779 (122,826)
180,953
Claims incurred but not reported
457,133 (159,847)
297,286
Balance at 31 December
760,912 (282,673)
478,239
Unearned premiums:
Balance at 1 January
(4,492 )
Premiums written during the year
(8,743 )
Premiums earned during the year
(237,867 )
Effect of movements in exchange rates
(432 )
(419 )
Balance at 31 December
(3,847 )
Deferred acquisition costs:
Balance at 1 January
(278 )
Acquisition costs written
(604 )
Acquisition costs earned
(83,314 )
(82,679 )
Effect of movements in exchange rates
(95 )
(90 )
Balance at 31 December
(242 )
11 Debtors arising out of direct insurance operations
2025
2024
$000
$000
Due within one year
Due after one year
Total
12 Debtors arising out of reinsurance operations
2025
2024
$000
$000
Due within one year
Due after one year
Total
13 Other debtors
2025
2024
$000
$000
Inter syndicate balances
Amounts owed from fellow subsidiary of managing agent
Other
Total
Hiscox Syndicate 3624
Notes to the accounts
Hiscox Syndicates 3624 Report and Accounts 2025
35
14 Claims development tables
The claims development tables below have been calculated by converting estimated claims and cumulative payments in Canadian
Dollars, Sterling and Euros to US Dollars at the closing rate of exchange at 31 December 2025. The table is produced on a year of
account basis. Some business is not off-risk after the first 12 months, therefore we would anticipate cumulative claims to increase in
the second year as this business is earned.
Pure underwriting
year:
Gross of reinsurance
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
$000
$000
$000
$000
$000
$000
$000
$000
$000
$000
Estimate of
cumulative claims:
At end of underwriting
year one
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
Cumulative payments
(511,201 ) (350,531 ) (341,717 ) (321,274 ) (211,048 ) (115,872 )
(59,245 )
(47,705 )
(16,521 )
(2,912 )
Estimated balance to
pay
Provision in respect of
prior years
Total gross provision
included in the balance sheet
Pure underwriting
year:
Net of reinsurance
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
$000
$000
$000
$000
$000
$000
$000
$000
$000
$000
Estimate of
cumulative claims:
At end of underwriting
year one
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
Cumulative payments
(324,067 ) (212,074 ) (116,018 )
(56,257 ) (188,731 ) (101,380 )
(57,326 )
(44,953 )
(15,739 )
(2,912 )
Estimated balance to
pay
(1,195 )
Provision in respect of
prior years
Total net provision
included in the balance sheet
Hiscox Syndicate 3624
Notes to the accounts
36
Hiscox Syndicates 3624 Report and Accounts 2025
15 Creditors arising out of direct insurance operations
2025
2024
$000
$000
Due within one year
Due after one year
Total
16 Creditors arising out of reinsurance operations
2025
2024
$000
$000
Due within one year
Due after one year
Total
17 Other creditors
2025
2024
$000
$000
Inter syndicate balances
Amounts owed to fellow subsidiary of managing agent
Derivative liabilities
Other
Total
18 Accruals and deferred income
2025
2024
$000
$000
Deferred reinsurance commission
207
242
Accrued expenses
1,458
84
Total
1,665
326
19 Cash and cash equivalents
2025
2024
$000
$000
Cash at bank and in hand
Short term debt instruments presented within other financial investments
Total cash and cash equivalents
Only deposits with maturities of three months or less that are used by the Syndicate in the management of its short-term
commitments are included in 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 in overseas jurisdictions.
2025
2024
$000
$000
Cash at bank and in hand
Short term debt instruments presented within other financial investments
Total cash and cash equivalents not available for use by the syndicate
Hiscox Syndicate 3624
Notes to the accounts
Hiscox Syndicates 3624 Report and Accounts 2025
37
20 Related parties
Related companies
Hiscox Syndicates Limited HSL) manages Syndicate 3624 as well as Syndicate 33 and Syndicate 6104. Syndicate 33
provides some reinsurance to Syndicate 3624 on an arm’s-length basis.
HSL is a wholly owned indirect subsidiary of Hiscox Ltd which is incorporated in Bermuda and listed on the London
Stock Exchange.
Hiscox Dedicated Corporate Member Limited, a wholly owned indirect subsidiary of Hiscox Ltd, is a corporate member within
the Hiscox Group which owns the entire capacity of all pure underwriting years of Syndicate 3624.
Hiscox Underwriting Group Services Limited, a wholly owned indirect subsidiary of Hiscox Ltd, is an employment service company
which employs all UK-based staff engaged in Syndicate 3624 activities including underwriters, claims handlers, reinsurance staff and
administrative staff. Hiscox Underwriting Group Services Limited charges a fee for the provision of these staff to Syndicate 3624 on
a no profit/no loss basis.
Hiscox Insurance Company (Bermuda) Limited, a wholly owned direct subsidiary of Hiscox Ltd, is a Class 4 insurer in Bermuda
authorised by the Bermuda Monetary Authority. It supplies some risk modelling services to HSL.
Hiscox Underwriting Ltd, a wholly owned indirect subsidiary of Hiscox Ltd, is an FCA authorised non-life insurance intermediary and
Lloyd’s Service Company. It places business with Syndicate 3624. It is not obliged to place business with any particular carrier and
these arrangements are subject to review by Hiscox Underwriting Ltd.
Hiscox Inc., a wholly owned indirect subsidiary of Hiscox Ltd, is a US authorised non-life insurance intermediary and Lloyd’s Service
Company. It places business with Syndicate 3624. It is not obliged to place business with any particular carrier and these
arrangements are subject to review by Hiscox Inc..
Hiscox Insurance Services Inc., a wholly owned indirect subsidiary of Hiscox Ltd, is a US authorised non-life insurance intermediary
and Lloyd’s Service Company. It places business with Syndicate 3624. It is not obliged to place business with any particular carrier
and these arrangements are subject to review by Hiscox Insurance Services Inc..
Hiscox Agencies Limited, a wholly owned indirect subsidiary of Hiscox Ltd, is authorised non-life insurance intermediary and Lloyd’s
Service Company. It places business with Syndicate 3624. It is not obliged to place business with any particular carrier and these
arrangements are subject to review by Hiscox Agencies Limited.
Hiscox Assure SAS is a regulated French insurance intermediary subject to the supervision of the French Prudential Supervisory
Authority ACPR (Autorité de contrôle prudentiel et de résolution) and Lloyd’s Coverholder. Hiscox Assure SAS is duly authorised
to conduct insurance intermediation activities in other Member States of the European Union and the European Economic Area.
It places business with Syndicate 3624. It is not obliged to place business with any particular carrier and these arrangements are
subject to review by Hiscox Assure SAS.
Hiscox Ltd indirectly owns a 32.27% holding in White Oak Underwriting Agency Limited, a FCA authorised non-life insurance
intermediary, which previously placed business with Syndicate 3624. White Oak Underwriting Agency Limited is not obliged to
place business with any particular carrier and these arrangements are subject to review from time to time by White Oak Underwriting
Agency Limited.
Underwriting divisions
Hiscox Ltd and its subsidiaries organises its core underwriting activities into a number of underwriting divisions. Some of these
divisions underwrite for multiple entities which are partly or wholly owned by Hiscox Ltd including Syndicate 3624, and some also
underwrite for entities not partly nor wholly owned by Hiscox Ltd. This integrated approach is aimed at maximising business
opportunities by using combined knowledge to develop new products and markets. There are certain predetermined mechanisms
for allocating certain types of insurance risks to these carriers which take into account the licences, capacity at Lloyd’s, available
capital, business plans and reinsurance programmes of each carrier. These arrangements are structured to take full and proper
account of the duties owed to the members of Syndicate 3624 and to manage appropriately any potential conflicts of interest.
Hiscox Syndicate 3624
Notes to the accounts
38
Hiscox Syndicates 3624 Report and Accounts 2025
The following balance sheet amounts were outstanding at year-end with related parties:
Balance sheet assets and (liabilities) outstanding
2025
2024
$000
$000
Hiscox Agencies Limited
(1,036)
(2,604)
Hiscox Inc.
6,764
4,935
Hiscox Underwriting Ltd
1,386
3,368
Other
(473)
(549)
The following amounts reflected in the profit and loss were transacted with related parties:
Net income and (expenses) reflected in the profit and loss
2025
2024
$000
$000
Hiscox Inc.
(78,539)
(77,843)
Hiscox Underwriting Group Services Limited
(11,791)
(10,786)
Hiscox Underwriting Ltd
(2,784)
(2,994)
Other
(680)
(755)
Hiscox Syndicates Limited charges no managing agent fees or profit commission to Syndicate 3624 (2024: nil).
Hiscox Underwriting Group Services Limited charges administrative services to the Syndicate on a no profit/no loss basis.
21 Foreign exchange rates
The following currency exchange rates have been used for principal foreign currency transactions:
2025
2025
2025
2024
2024
2024
start of period rate
end of period rate
average rate
start of period rate
end of period rate
average rate
US Dollar
Sterling
Euro
Canadian Dollar
22 Syndicate structure
The managing agent of the Syndicate is Hiscox Syndicates Limited whose immediate parent undertaking is Hiscox Holdings Limited,
a company registered in England and Wales. The ultimate parent undertaking of the largest and smallest group of companies for
which Group accounts are drawn up is Hiscox Ltd, Bermuda. Copies of Hiscox Ltd report and accounts can be obtained from
Chesney House, 96 Pitts Bay Road, Pembroke HM 08, Bermuda.
Hiscox Syndicate 3624
Notes to the accounts
Hiscox Syndicates 3624 Report and Accounts 2025
39
Hiscox Syndicates Limited is authorised by the Prudential
Regulation Authority and regulated by the Financial Conduct
Authority and Prudential Regulation Authority.
23278 02/26
Hiscox
22 Bishopsgate
London EC2N 4BQ
United Kingdom
T +44 (0)20 7448 6000
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