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SYNDICATE 3623
ANNUAL REPORT AND ACCOUNTS
YEAR ENDED
CONTENTS
STRATEGIC REPORT OF THE MANAGING AGENT…………………………………………………………… 4
MANAGING AGENT’S REPORT………………………………………………………………………………………… 6
STATEMENT OF MANAGING AGENT’S RESPONSIBILITIES……………………………………………… 15
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF SYNDICATE 3623 …………… 16
STATEMENT OF COMPREHENSIVE INCOME …………………………………………………………………… 19
BALANCE SHEET ……………………………………………………………………………………………………………… 20
STATEMENT OF CHANGES IN MEMBER'S BALANCES ……………………………………………………… 21
STATEMENT OF CASH FLOWS …………………………………………………………………………………………… 22
NOTES TO THE SYNDICATE ANNUAL ACCOUNTS ……………………………………………………………… 23
MANAGING AGENT'S CORPORATE INFORMATION …………………………………………………………… 49
SYNDICATE 3623
31 DECEMBER 2025
3
STRATEGIC REPORT OF THE MANAGING AGENT
Overview
Syndicate 3623 (the ‘syndicate’) writes a portfolio of North American surplus lines business across a
number of classes - property, cyber and specialty. The result for Syndicate 3623 for the year ended 31
December 2025 is a profit of $77.6m (2024: $65.9m).
The capacities of the syndicates managed by Beazley Furlonge Limited ("BFL") are as follows:
Syndicate Number Capacities
2025 Year of Account
£ m
2024 Year of Account
£ m
623 861.0 887.2
2623 2,357.1 2,299.6
3622 35.5 37.0
3623 432.0 1,325.6
4321 — —
5623 419.3 396.6
6107 43.9 57.8
Total 4,148.8 5,003.8
Year of account results
The syndicate did not underwrite for the 2023 year of account. The 2024 and 2025 year of account are
currently forecasting positive returns on capacity.
Rating environment
Rates on renewal business decreased by 1.9% in 2025 (2024: 0.6% decrease). There was continued
pressure on rates on the Property Risks and Cyber Risk lines after a period of rate increases in recent
years. Rates in the Specialty Risks division remained robust in the period.
The syndicates’ gross written premiums for 2025 are $432.1m (2024: $1,336.0m). This reflects a 67.7%
decrease, driven primarily by further reductions in the business underwritten by Beazley’s US-based
underwriters. Net earned premiums for 2025 are $754.8m (2024: $572.1m). This increase reflects 2025
having two underwriting years' premium now earning through on the face of P&L, noting that the syndicate
did not actively underwrite on the 2023 YoA.
Combined ratio
The combined ratio is a measure of operating performance and represents the ratio of the syndicate's total
costs (excluding foreign exchange movements) to total net earned premium. A combined ratio under
100% indicates an underwriting profit. The calculation of the combined ratio for the syndicate includes all
claims and other costs of the syndicate but excludes foreign exchange gains or losses. The syndicate's
combined ratio for 2025 financial year was 95.0% (2024: 91.1%). The increase in combined ratio is
primarily driven by a deterioration in the claims ratio.
Claims
The claims ratio is a measure of the syndicate's claims experience and represents the ratio of its net
insurance claims to net earned premium. The syndicate had a claims ratio of 56.5% for the financial year
2025 (2024: 51.8%). The syndicate has prior year reserves strengthening of $14.3m in 2025 (2024:
releases of $25.0m), primarily driven by claims strengthening on the Specialty Risk classes, outweighing
favourable Property experience.
SYNDICATE 3623
31 DECEMBER 2025
4
STRATEGIC REPORT OF THE MANAGING AGENT CONTINUED
Net operating expenses
Net operating expenses, including business acquisition costs and administrative expenses were $290.7m
(2024: $224.6m). The expense ratio is a measure of net operating expenses to net earned premium. The
expense ratio in 2025 is 38.5% (2024: 39.3%).
The breakdown of these costs is shown below:
2025
2024
$m
$m
Brokerage costs
214.3 171.8
Other acquisition costs
7.2 2.1
Total acquisition costs
221.5 173.9
Administrative and other expenses
69.2 50.7
Net operating expenses
1
290.7 224.6
1 A further breakdown of net operating expenses can be seen in note 4.
Brokerage costs as a percentage of net earned premiums are approximately 28.4% (2024: 30.0%). Other
acquisition costs comprise of costs that have been identified as being directly related to underwriting
activity (e.g. underwriters’ salaries and Lloyd’s box rental). These costs are also deferred in line with
premium earning patterns. Administrative expenses comprise primarily IT costs, facilities costs, Lloyd’s
central costs and other support costs.
Investment performance
The syndicate’s investments generated a return of $36.7m, or 4.3% in 2025 (2024: a return of $16.9m, or
3.1%). Financial assets increased to $863.8m as at 31 December 2025 (31 December 2024: $823.3m),
driven primarily from operational cash flows on the 2025 YoA, less the distribution of the 2022 YoA
members balance.
Reinsurance
In 2025, the amount spent on outward reinsurance was $7.8m (2024: $246.3m). The primary driver of
the reduction is the significant reduction in gross written premium of 67.7%. Additionally, a reallocation of
reinsurance premiums across the Beazley Group in relation to certain Cyber Risks cover, reflective of
exposure on the 2025 YoA, and change in business mix has led to a reduction in reinsurance premium, as
a percentage of gross written premium, to 1.8% (2024: 18.4%).
Outlook
In 2025 the syndicate continued to write a portfolio of North American surplus lines business across a
number of classes - property, cyber and specialty but at a much reduced volume compared to 2024.
Looking ahead to 2026, the syndicate is expected to continue to write this business, albeit at reduced
volumes. The business currently written in this syndicate will continue to transition from Syndicate 3623 to
another Beazley entity in the US.
…………………………
C C J Wong
Director
19 February 2026
SYNDICATE 3623
31 DECEMBER 2025
5
MANAGING AGENT’S REPORT
The managing agent presents its report for the year ended 31 December 2025.
This annual report is prepared using the annual basis of accounting as required by Statutory Instrument
No 1950 of 2008, the Insurance Accounts Directive (Lloyd’s Syndicate and Aggregate Accounts)
Regulations 2008 and applicable United Kingdom Accounting Standards, including Financial Reporting
Standard 102: The Financial Reporting Standard applicable in the United Kingdom and Republic of Ireland
and Financial Reporting Standard 103: Insurance Contracts.
Principal activity
In 2025, the syndicate wrote a portfolio of North American surplus lines business across a number of
classes - property, cyber and specialty.
Business review
A review of the syndicate’s activities and future outlook is included in the strategic report.
Risk governance and reporting
BFL’s Board of Directors (the 'Board') has the responsibility for defining and monitoring the risk appetite
within which BFL and the syndicates operate (collectively, ‘Beazley’), with key individuals and committees
accountable for day-to-day management of risks and controls. Regular reporting from the Risk Function to
Board and Risk Committee meetings and senior management committees ensures that risks are monitored
and managed as they arise. Beazley Group is structured across three platforms, one of which is the London
Wholesale platform governed by BFL on behalf of the syndicates. This platform-focused structure
strengthens leadership accountability, enhances platform-level and legal entity governance, and further
reinforces the effectiveness of the overall risk management framework.
Climate-related risks and opportunities
Climate-related risks, opportunities, and other sustainability related matters were regular agenda items
throughout 2025 led by Beazley plc’s Board and supported by the boards of BFL and the Group’s other
regulated subsidiaries. The Group’s sustainability strategy, sets out the goals and targets across a wider
range of sustainability issues, including climate change. Beazley plc’s consolidated Annual report and
accounts includes the Group’s disclosures for the Task Force on Climate-Related Financial Disclosures
('TCFD') Recommendations. The 2025 Beazley plc Annual report and accounts is expected to be published
on the Group's website in March 2026.
Although not specifically listed in the risk categories detailed further in this report, the Board of BFL deems
climate risk to be inherently embedded within all risks managed across the syndicate.
Risk management
The Board maintains a sound understanding of all drivers of risk and, supported by the Risk Function,
provides effective challenge to management in overseeing risks across Beazley. The Board and the Risk
Committee continue to ensure that the risk management framework remains aligned to Beazley’s evolving
risk profile, supports robust oversight and challenge, and embeds a strong risk culture across the business.
The Board remains attentive to emerging risks and developments in the regulatory and legal landscape.
The Risk Function continues to engage in key strategic projects, providing proportionate and effective
second-line challenge to support the ongoing evolution of the risk management framework.
The effectiveness of risk management across the business is underpinned by continued collaboration
between Beazley's assurance functions, in particular Compliance, Risk Function and, Control and
Compliance Assurance Team to deliver a coherent second line oversight function.
Throughout the year, Beazley strengthened its risk leadership team and further matured its risk culture
across the Group. Investment in both the first and second lines of defence has progressed through the
phased delivery of modernisation and transformation programmes, to enhance oversight, agility and
overall risk management capability.
Risk management oversight and framework
The Board has ultimate responsibility for risk management and delegates direct oversight of the risk
management framework to its Risk Committee. The Board delegates executive oversight of the Risk
Function and framework to the BFL Management Committee, which fulfils this responsibility in conjunction
with the Group Risk and Regulatory Committee.
The risk management framework sets out the approach to identifying, assessing, managing, monitoring,
and reporting principal risks. This framework underpins the delivery of the Group’s strategic priorities and
supports informed decision making at all levels.
SYNDICATE 3623
31 DECEMBER 2025
6
MANAGING AGENT’S REPORT CONTINUED
Beazley operates a governance structure founded on the ‘three lines of defence’ model, with the Risk
Function forming part of the second line of defence. Ongoing communication and collaboration across the
three lines of defence ensures that Beazley identifies and manages risks effectively.
The Board approves Beazley's risk appetite statements annually and receives regular updates throughout
the year on performance against these appetites, including impact on the risk profile of the business.
A comprehensive suite of reports from the Risk Function supports senior management and the Board in
fulfilling their oversight responsibilities. These reports include updates on risk culture, risk appetite, risk
profiles, stress and scenario testing (including reverse stress testing) and analysis, emerging and
heightened risks, and the Own Risk and Solvency Assessment. In addition, the Risk Function provides
reporting to the Remuneration Committee to ensure alignment between risk considerations and
remuneration practices.
An annual risk management plan is developed, with reference to Beazley's business strategy, external
market and regulatory developments, as well as Beazley's risk profile. In addition, the Risk Function
integrates insights from internal audit findings and other assurance activities into its risk assessment and
planning processes to ensure a comprehensive and forward-looking approach.
The approach to identifying, managing and mitigating emerging risks includes inputs from across the
business, analysis of lessons learned following incidents and industry thought leadership. The approach
considers the potential materiality and likelihood of impacts, which helps prioritise emerging risks that
Beazley monitors or undertakes focused work on. Key emerging risks in 2025 included: Artificial
Intelligence; Geopolitical and conflict escalation; Supply chain complexity; and Political and social unrest/
instability.
Principal risks
Beazley operates in a dynamic environment where risk exposures evolve in response to changes in market
conditions, regulatory developments, and strategic priorities. Identifying and managing these risks is
fundamental to safeguarding Beazley's financial strength and delivering sustainable value to stakeholders.
Principal risks are subject to regular review through Beazley's risk and control assessment process. The
overall risk profile is continuously monitored with emphasis on operational and regulatory risks, to ensure
that our control environment and risk management capabilities evolve in line with business change and
developments in the external environment.
The table below summarises the principal risks faced by Beazley, together with the governance, oversight
and control measures in place to mitigate these exposures, and the associated outlook.
Legend for principal risks table below
Risk outlook
Increasing Stable Decreasing
SYNDICATE 3623
31 DECEMBER 2025
7
MANAGING AGENT’S REPORT CONTINUED
Insurance
Risk of loss arising from uncertainties and
deviations of the occurrence, frequency,
amount and timing of insurance premium
and claim liabilities relative to the
assumptions at the time of underwriting.
This includes key underwriting risk drivers
such as market cycle, catastrophe,
reinsurance, reserves and climate.
• Market cycle: potential
systematic mispricing of
medium- or long-tailed business
that does not support revenue to
invest and cover future claims;
• Catastrophe: one or more large
events caused by nature (e.g.
hurricane, windstorm,
earthquake and/or wildfire) or
mankind (e.g. systemic cyber-
event, global pandemic, losses
linked to an economic crisis, an
act of terrorism or an act of war
and/or a political event)
impacting a number of policies,
and therefore giving rise to
multiple losses;
• Reinsurance arrangements:
reinsurance may not be available
or purchases do not support the
business underwritten (e.g.
mismatch);
• Reserving: reserves may not be
sufficiently established to reflect
the ultimate paid losses; and
• Climate risk: impact of climate
change on underwriting and
reserving assumptions, including
the risk arising from the physical
effects of climate change, the
transition to a low-carbon
economy and associated
litigation risks.
Insurance risk, arising in the syndicates, is principally managed
by Beazley through pricing tools, analysis of macro trends and
claim frequency/severity, which ensures exposure is well
diversified and not overly concentrated in any one area, or line of
business.
Our strategic approach to exposure management and a
comprehensive internal and external reinsurance programme
help to reduce volatility of profits in addition to managing net
exposure through the transfer of risk.
Our prudent and comprehensive approach to reserving ensures
adequate provisions are made for the payment of all valid claims.
High calibre claims and underwriting professionals deliver expert
service and claims handling to insureds, ensuring good customer
outcomes.
Beazley carries out periodic analysis to identify significant areas
of concentration risk across its business and monitors solvency
regularly to ensure adequate capitalisation.
Beazley continuously monitors key trends and incidents,
particularly for evolving perils such as cyber, to ensure our view
of risk is up-to-date.
Beazley makes extensive use of modelling, including catastrophe
modelling, the use of our Solvency II model and stress and
scenario testing to ensure insurance risk is within approved risk
appetite.
Beazley integrates management of climate risk into its business
processes for physical and litigation risk, through climate-
adjusted pricing, capital modelling and climate conditioned views
of risk for its most sensitive perils and supporting underwriting
using targeted tools and dashboards and scenario analysis. The
approaches continue to develop, given the evolving nature of
climate risk.
Investment in underwriting, reinsurance, and exposure
management systems and processes continue to strengthen our
risk management capabilities in an increasingly complex
landscape shaped by advances in artificial intelligence, rising
geopolitical tensions, and climate-related natural hazards.
Outlook:
While we continue to assess Beazley's insurance risk outlook as
stable, supported by active management of market cycles across
all lines of business, we recognise that the cycle of rate increases
have likely peaked and in the absence of a market turning event,
we anticipate further soft market pressures in the near term,
making effective risk management increasingly critical.
Principal risks and summary description Mitigation and monitoring
SYNDICATE 3623
31 DECEMBER 2025
8
Credit
Exposure to credit risk largely emanates
from the use of reinsurers, brokers, and
coverholders.
Credit risk is the risk of loss resulting from
default in obligations due or changes in
the credit standing of either issuers of
securities, counterparties or any debtors
which Beazley is exposed to.
Beazley maintains long-term partnerships with strategic
reinsurance partners to support it throughout the insurance cycle
and during potential catastrophic claim events. Beazley uses a
range of traditional and alternative reinsurance mechanisms to
diversify reinsurance credit risk. All reinsurers must meet
stringent internal approval criteria, overseen by the Reinsurance
Security Committee.
Beazley operates established broker relationships and mitigates
credit risk via the monitoring of broker concentrations, payment
performance oversight and broker onboarding review criteria.
Coverholder monitoring and onboarding utilises a risk-based
approach, using financial stability information, overseen by the
Delegated Authority Oversight Committee.
Investment credit risks are managed with a well-diversified
portfolio, with investment parameters by type, duration and
credit quality, monitored by the Investment Committee.
Outlook:
The credit risk outlook remains stable, as Beazley manages
reinsurance, broker, coverholder and investment credit risks,
maintaining low levels of aged and/or bad debt.
Principal risks and summary description Mitigation and monitoring
SYNDICATE 3623
31 DECEMBER 2025
9
Market
The risk of loss resulting from fluctuations
in the level and in the volatility of market
prices of assets, liabilities and financial
instruments. Investment assets may be
impacted by adverse movements in
financial markets, interest rates,
exchange rates, or external market
forces.
Beazley operates a conservative investment strategy to ensure
adequate funds available to pay claims. We employ robust
policies and tools to manage market risk, ensuring alignment
with regulatory requirements and industry best practices.
Interest rate and foreign exchange risks are managed using
natural hedges and financial instruments, minimizing potential
volatility. The Investment Committee regularly reviews market
risk exposures to ensure that our risk management capabilities
remain agile and effective in responding to evolving market
dynamics.
Beazley continues to develop its understanding of how climate
change impacts our investment portfolio to help inform alignment
with our sustainability goals and create long-term value.
Outlook:
We maintain a stable market risk outlook for 2026, underpinned
by active investment portfolio management and a robust internal
control framework.
Group
The contagion risk that an action or
inaction of one part of the Beazley Group
adversely affect another part or parts of
the syndicate. This also includes a
changes in culture which leads to
inappropriate behaviour, actions and/or
decisions including dilution of culture or
negative impact on the brand.
In 2025, Beazley further developed its Risk Culture Framework,
to align with industry best practice. The framework is
underpinned by six guiding principles: Leadership and Tone from
the Top; Risk Governance and Accountability; Risk Awareness;
Communication and Transparency; Risk and Reward; and
Innovation and Adaptiveness.
A strong risk culture is the cornerstone of a mature risk function.
It enables informed and responsible decision-making, fosters
transparency, and promotes vigilance across both existing and
emerging risks, ensuring Beazley remains resilient and forward-
looking in an evolving risk and regulatory landscape. In 2025,
advancing our risk culture maturity was a key management
priority. A series of organisation-wide initiatives were launched to
strengthen communication and engagement, with the aim of
cultivating a consistent and robust risk culture. These efforts
focused on building a shared understanding of risk, encouraging
proactive management, and reinforcing a supportive ‘speak up’
environment.
Beazley operates shared services, systems, processes and
controls across different legal entities and jurisdictions. As such,
the impact of an issue or incident in one area of the business can
have implications across the Group (i.e. contagion risk). To
mitigate this risk we continue focus on group-wide strategic
initiatives, which include continued enhancement of our internal
control environment and optimization of key business and IT
processes through deployment of technology solutions.
The BFL Management Committee and the Board oversee Group
risk, with regular monitoring conducted by the Risk Function and
overseen by the Risk Committee.
Outlook:
Our Group risk outlook remains stable, with the BFL Management
Committee continuously evolving our risk culture through
ongoing monitoring and annual assessments, designed to drive
enhancements.
Principal risks and summary description Mitigation and monitoring
SYNDICATE 3623
31 DECEMBER 2025
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MANAGING AGENT’S REPORT CONTINUED
Liquidity
Investments and/or other assets are
not available or adequate in order to
settle financial obligations when they
fall due.
By actively managing its liquidity needs, Beazley maximizes flexibility in
handling its financial assets and investment strategy. This proactive
approach ensures that clients and creditors are financially protected.
Beazley regularly evaluates the liquidity position of the syndicates,
under the oversight of the Risk Committee.
Liquidity stress testing is performed to assess the largest cash flow
demands from the ten most severe Realistic Disaster Scenarios across a
1-day and 12-month time horizon.
Liquidity is monitored quarterly to ensure an adequate liquidity surplus
is maintained, such that liquidity exceeds internal requirements, even
under stressed scenarios.
Outlook:
The liquidity risk outlook remains stable, with sufficient available
liquidity to meet expected cashflow requirements, including under
stressed scenarios, while maintaining adequate levels of liquidity and
capital buffers.
Regulatory and legal
The risk of non-compliance with
regulatory and legal requirements
and supervisory expectations or
failing to operate in line with the
relevant regulatory framework in the
territories where Beazley operates.
This may lead to financial loss (fines,
penalties), sanctions, reputational
damage, loss of confidence from
regulators, regulatory intervention,
inability to underwrite or pay claims.
Beazley’s compliance framework supports adherence to rules, laws and
regulatory expectations including through horizon scanning, advice and
training. The work of the compliance function is overseen by the Risk
and Regulatory Committee.
In 2025, we implemented a global horizon scanning tool to support the
increasing size and complexity of our multi- jurisdictional business. This
tool aids in identifying, assessing and implementing new and emerging
legal and regulatory policy in a way that is both accessible and
immediate across all areas of our business and locations that we
underwrite. Additionally, it helps to increase awareness of the
regulatory environment for a wider audience, strengthens our
adherence to requirements and provides additional clarity over the
expectations of our regulators.
We enhanced our regulatory engagement protocols by developing a
new framework, establishing oversight and strengthening our reporting
mechanisms for sharing key information with our regulators. To ensure
effective embedding of the new protocols and further strengthen our
culture of transparency and openness, we provided firm-wide training
to ensure that expectations are understood.
Delivering good customer outcomes remains central to our business.
The second line functions contribute to the work of the Conduct Review
Group, which provides oversight of conduct risk throughout the product
lifecycle, ensuring we are able to consistently meet regulatory
expectations for the treatment of our policyholders and retail
customers.
Beazley maintains a very low appetite for regulatory and legal risk. As
we consolidate the regulatory engagement achieved in 2025 and
navigate an increasingly complex environment, maintaining strong and
open relationships with our regulators remains paramount.
Outlook:
The outlook for this risk has moved from increased to stable as a result
of the positive action taken above. We also continue to enhance our key
systems and internal control frameworks as well as adapting our
compliance framework to adhere to our regulatory and compliance
landscape. We expect the risk outlook to improve as changes become
well embedded.
Principal risks and summary description Mitigation and monitoring
SYNDICATE 3623
31 DECEMBER 2025
11
Operational
The risk of failure of people,
processes and systems or the impact
of an external event on Beazley's
operations.
Primary risk drivers include
technology, information
management, project and change
transformation, third-party
management and the process and
people related infrastructure
supporting core business activities;
Underwriting and Claims
management.
Our risks and controls are formally monitored and reported through a
risk and control self-assessment process and the use of quantifiable Key
Risk Indicators. Our ongoing control enhancement and underwriting
transformation programmes are designed to ensure that Beazley is fully
equipped to meet current and future operational challenges,
strengthening our resilience and supporting sustainable growth.
In 2025, we further advanced our investment in technology and process
re-engineering to strengthen our operational capabilities and add
resilience to internal processes and associated controls. Our business
continuity, disaster recovery and incident response plans ensure the
stability of our processes and systems, enabling our team to
consistently deliver optimal outcomes for our clients.
As the external environment grows more complex, technology and
cyber resilience remain top priorities. We have advanced our cyber
maturity journey, collaborating with external agencies, and maintaining
robust controls over information security, data and operational
resilience. Regular reviews of our incident response plans and ongoing
investment in cyber security training for all employees ensure we
remain vigilant and prepared.
While maintaining a low appetite for operational risk, we observed an
increase in reported risk incidents during 2025, albeit of lower
materiality, reflecting both the growing complexity of our operational
environment and our enhanced risk awareness and reporting culture.
Our Risk Function works closely with first line teams to ensure that
controls and processes evolve in line with emerging risks and business
change.
Outlook:
This risk has moved from an increased to stable outlook in 2026,
reflecting a reduction in the severity of operational risk incidents. This is
supported by the continued benefits of our investment in modernising
controls, systems and processes. As our transformation programmes
and modernisation initiatives progress, we expect these efforts to
further enhance our operational resilience in the years ahead.
Principal risks and summary description Mitigation and monitoring
SYNDICATE 3623
31 DECEMBER 2025
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MANAGING AGENT’S REPORT CONTINUED
Principal risks and summary description Mitigation and monitoring
Strategic
The risk of loss resulting from ineffective strategic
direction and implementation that leads to
inadequate profitability, financial loss and/or
reputational damage.
Pervasive risks impacting multiple areas of Beazley
(e.g., reputation, and sustainability) occurring
through real or perceived action, or inaction, by a
regulatory body, market and/or third-party
provider.
A negative change to Beazley’s reputation would
have a detrimental impact to BFL and the
syndicates performance and public perception.
Beazley consistently addresses key strategic
opportunities and challenges, striving to be the
highest performing and most sustainable specialist
insurer. We ensure that we recognise, understand,
discuss, and develop action plans for significant
strategic priorities in a timely manner, while
maintaining operational effectiveness and brand
reputation.
More widely over the past 18 months, Beazley has
made enhancements to its corporate governance
arrangements to align to a three-platform model. It
aims to ensure that the legal entities benefit from
increased transparency, and clarity around decision-
making powers & autonomy, which aims to de-risk
the organisation. The three platform model has been
implemented and will continue to be embedded
throughout 2026.
Beazley creates an environment that attracts, retains
and develops high performing talent with diverse
perspectives, encouraging exploration, creation, and
innovation. By investing in understanding the
complexities of the risks our clients face and
deploying our expertise where it adds value, we
thrive. The BFL Management Committee and the
Board oversee these risks, in collaboration with the
Group Executive Committee.
Our commitment is to create a sustainable business
for our people, partners, and planet through
responsible business goals. This focuses on
understanding and reducing our carbon footprint,
contributing positively to our social environment, and
upholding strong governance practices. Sustainability
principles are embedded into business planning with a
documented transition plan and reputational risk is
mitigated through transparent climate-related
decision-making across underwriting, investments
and operations. While market developments are
considered, each is evaluated individually to balance
potential opportunities and risks.
Outlook:
As we build on our past achievements, our outlook for
strategic risk in 2026 remains stable, underpinned by
our commitment to disciplined growth, innovation and
sustainability.
SYNDICATE 3623
31 DECEMBER 2025
13
Directors
A list of Directors of the managing agent who held office during the year and to the date of this report can
be found on page 49.
Disclosure of information to the auditor
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 auditor is 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 auditor is aware of that information.
Auditor
Pursuant to Section 14(2) of Schedule 1 of the Insurance Accounts Directive (Lloyd’s Syndicate and
Aggregate Accounts) Regulations 2008, the auditor will be deemed to be reappointed and Ernst & Young
LLP will therefore continue in office.
On behalf of the board
…………………………
C C J Wong
Director
19 February 2026
SYNDICATE 3623
31 DECEMBER 2025
14
STATEMENT OF MANAGING AGENT’S RESPONSIBILITIES
The Directors of the managing agent are responsible for preparing the syndicate financial statements in
accordance with applicable law and regulations.
The Insurance Accounts Directive (Lloyd’s Syndicate and Aggregate Accounts) Regulations 2008 requires
the Directors of the managing agent to prepare their syndicate annual accounts for each financial year.
Under that law they have elected to prepare the annual accounts in accordance with UK Accounting
Standards and applicable law (UK Generally Accepted Accounting Practice), including FRS 102 The
Financial Reporting Standard applicable in the UK and Republic of Ireland.
Under Insurance Accounts Directive (Lloyd’s Syndicate and Aggregate Accounts) Regulations 2008 the
Directors of the managing agent must not approve the annual accounts unless they are satisfied that they
give a true and fair view of the state of affairs of the syndicate and of the statement of comprehensive
income of the syndicate for that period. In preparing these financial statements, the Directors of the
managing agent are required to:
• select suitable accounting policies and then apply them consistently;
• make judgements and estimates that are reasonable and prudent;
• state whether applicable UK Accounting Standards have been followed, subject to any material
departures disclosed and explained in the annual accounts;
• assess the syndicate’s ability to continue as a going concern, disclosing, as applicable, matters related
to going concern; and
• use the going concern basis of accounting unless they either intend to cease trading, or have no
realistic alternative but to do so.
The Directors of the managing agent are responsible for keeping adequate accounting records that are
sufficient to show and explain the syndicate’s transactions and disclose with reasonable accuracy at any
time the financial position of the syndicate and enable them to ensure that the financial statements comply
with the Insurance Accounts Directive (Lloyd’s Syndicate and Aggregate Accounts) Regulations 2008. They
are responsible for such internal control as they determine is necessary to enable the preparation of
financial statements that are free from material misstatement, whether due to fraud or error and have
general responsibility for taking such steps as are reasonably open to them to safeguard the assets of the
company and to prevent and detect fraud and other irregularities.
The Directors of the managing agent are responsible for the maintenance and integrity of the syndicate
and financial information included on the syndicate’s website. Legislation in the UK governing the
preparation and dissemination of financial statements may differ from legislation in other jurisdictions.
The Directors of the managing agent are required to comply with the requirements of Section 1 of the
Lloyd’s Syndicate Accounts Instructions version 3.1 as modified by the Frequently Asked Questions Version
1.1 issued by Lloyd’s (the 'Syndicate Accounts Instructions').
The Directors of the managing agent are responsible for the preparation and review of the iXBRL tagging
that has been applied to the syndicate accounts in accordance with the instructions issued by Lloyd's,
including designing, implementing and maintaining systems, processes and internal controls to result in
tagging that is free from material non-compliance with the instructions issued by Lloyd's, whether due to
fraud or error.
We confirm that to the best of our knowledge the syndicate accounts, including the iXBRL tagging applied
to these accounts, comply with the requirements of the Lloyd’s Syndicate Accounts Instructions version 3.1
as modified by the Frequently Asked Questions version 1.1 issued by Lloyd’s.
On behalf of the Board
…………………………
C C J Wong
Director
19 February 2026
SYNDICATE 3623
31 DECEMBER 2025
15
Opinion
We have audited the syndicate annual accounts of syndicate 3623 (‘the syndicate’) for the year ended 31
December 2025 which comprise the Statement of Comprehensive Income, the Balance Sheet, the
Statement of Changes in Members’ Balances, the Statement of Cash Flows and the related notes 1 to 23,
including a summary of significant accounting policies. The financial reporting framework that has been
applied in their preparation is applicable law including The Insurance Accounts Directive (Lloyd’s Syndicate
and Aggregate Accounts) Regulations 2008, United Kingdom Accounting Standards including FRS 102 ‘The
Financial Reporting Standard applicable in the UK and Republic of Ireland’ and FRS 103 ‘Insurance
Contracts’ (‘United Kingdom Generally Accepted Accounting Practice’), and Section 1 of the Lloyd’s
Syndicate Accounts Instructions V3.1 as modified by the Frequently Asked Questions Version 1.1 issued by
Lloyd’s (‘the Syndicate Accounts Instructions’).
In our opinion, the syndicate annual accounts:
• give a true and fair view of the syndicate’s affairs as at 31 December 2025 and of its Profit for the
year then ended;
• have been properly prepared in accordance with United Kingdom Generally Accepted Accounting
Practice; and
• have been prepared in accordance with the requirements of The Insurance Accounts Directive
(Lloyd’s Syndicate and Aggregate Accounts) Regulations 2008 and the Syndicate Accounts
Instructions.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)), The
Insurance Accounts Directive (Lloyd’s Syndicate and Aggregate Accounts) Regulations 2008, the Syndicate
Accounts Instructions, and other applicable law. Our responsibilities under those standards are further
described in the Auditor’s responsibilities for the audit of the syndicate annual accounts section of our
report. We are independent of the syndicate in accordance with the ethical requirements that are relevant
to our audit of the syndicate annual accounts in the UK, including the FRC’s Ethical Standard as applied to
other entities of public interest, and we have fulfilled our other ethical responsibilities in accordance with
these requirements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
opinion.
Conclusions relating to going concern
In auditing the syndicate annual accounts, we have concluded that the managing agent’s use of the going
concern basis of accounting in the preparation of the syndicate annual accounts is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events
or conditions that, individually or collectively, may cast significant doubt on the syndicate’s ability to
continue as a going concern for a period of 12 months from when the syndicate annual accounts are
authorised for issue. from when the syndicate annual accounts are authorised for issue.
Our responsibilities and the responsibilities of the directors of the managing agent with respect to going
concern are described in the relevant sections of this report. However, because not all future events or
conditions can be predicted, this statement is not a guarantee as to the syndicate’s ability to continue as a
going concern.
Other information
The other information comprises the information included in the annual report and accounts other than the
syndicate annual accounts and our auditor’s report thereon. The directors of the managing agent are
responsible for the other information contained within the annual report and accounts.
Our opinion on the syndicate annual accounts does not cover the other information and, except to the
extent otherwise explicitly stated in this report, we do not express any form of assurance conclusion
thereon.
Our responsibility is to read the other information and, in doing so, consider whether the other information
is materially inconsistent with the syndicate annual accounts or our knowledge obtained in the course of
the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or
apparent material misstatements, we are required to determine whether this gives rise to a material
misstatement in the syndicate annual accounts themselves. If, based on the work we have performed, we
conclude that there is a material misstatement of the other information, we are required to report that
fact.
We have nothing to report in this regard.
SYNDICATE 3623
31 DECEMBER 2025
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF SYNDICATE 3623
16
Opinions on other matters prescribed by The Insurance Accounts Directive (Lloyd’s Syndicate
and Aggregate Accounts) Regulations 2008
In our opinion, based on the work undertaken in the course of the audit:
• the information given in the managing agent’s report for the financial year in which the syndicate
annual accounts are prepared is consistent with the syndicate annual accounts; and
• the managing agent’s report has been prepared in accordance with applicable legal requirements.
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the syndicate and its environment obtained in the
course of the audit, we have not identified material misstatements in the managing agent’s report.
We have nothing to report in respect of the following matters where The Insurance Accounts Directive
(Lloyd’s Syndicate and Aggregate Accounts) Regulations 2008 requires us to report to you, if in our
opinion:
• the managing agent in respect of the syndicate has not kept adequate accounting records; or
• the syndicate annual accounts are not in agreement with the accounting records; or
• certain disclosures of the managing agent’s emoluments specified by law are not made; or
• we have not received all the information and explanations we require for our audit.
Responsibilities of the directors of the managing agent
As explained more fully in the Statement of Managing Agent’s Responsibilities set out on page 15, the
directors of the managing agent are responsible for the preparation of the syndicate annual accounts and
for being satisfied that they give a true and fair view, and for such internal control as they determine is
necessary to enable the preparation of the syndicate annual accounts that are free from material
misstatement, whether due to fraud or error.
In preparing the syndicate annual accounts, the directors of the managing agent are responsible for
assessing the syndicate’s ability to continue in operation, disclosing, as applicable, matters related to its
ability to continue in operation and using the going concern basis of accounting unless the directors of the
managing agent either intends to cease to operate the syndicate, or has no realistic alternative but to do
so.
Auditor’s responsibilities for the audit of the syndicate annual accounts
Our objectives are to obtain reasonable assurance about whether the syndicate annual accounts as a
whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report
that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an
audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error and are considered material if, individually or in the
aggregate, they could reasonably be expected to influence the economic decisions of users taken on the
basis of these syndicate annual accounts.
Explanation as to what extent the audit was considered capable of detecting irregularities,
including fraud
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design
procedures in line with our responsibilities, outlined above, to detect irregularities, including fraud. The risk
of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting
from error, as fraud may involve deliberate concealment by, for example, forgery or intentional
misrepresentations, or through collusion.
The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed
below. However, the primary responsibility for the prevention and detection of fraud rests with both those
charged with governance of the managing agent and management.
Our approach was as follows:
• We obtained a general understanding of the legal and regulatory frameworks that are applicable to
the syndicate and determined that the most significant are direct laws and regulations related to
elements of Lloyd’s Byelaws and Regulations, and the financial reporting framework (UK United
Kingdom Generally Accepted Accounting Practice), and requirements referred to by Lloyd’s in the
Syndicate Accounts instructions. Our considerations of other laws and regulations that may have a
material effect on the syndicate annual accounts included permissions and supervisory
requirements of Lloyd’s of London, the Prudential Regulation Authority (‘PRA’) and the Financial
Conduct Authority (‘FCA’).
SYNDICATE 3623
31 DECEMBER 2025
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF SYNDICATE 3623
17
• We obtained a general understanding of how the syndicate is complying with those frameworks by
making enquiries of management, internal audit, and those responsible for legal and compliance
matters of the syndicate. In assessing the effectiveness of the control environment, we also
reviewed significant correspondence between the syndicate, Lloyd’s of London and other UK
regulatory bodies; reviewed minutes of the Board and Risk Committee of the managing agent; and
gained an understanding of the managing agent’s approach to governance.
• For direct laws and regulations, we considered the extent of compliance with those laws and
regulations as part of our procedures on the related syndicate annual accounts’ items.
• For both direct and other laws and regulations, our procedures involved: making enquiries of the
directors of the managing agent and senior management for their awareness of any non-
compliance of laws or regulations, enquiring about the policies that have been established to
prevent non-compliance with laws and regulations by officers and employees, enquiring about the
managing agent’s methods of enforcing and monitoring compliance with such policies, and
inspecting significant correspondence with Lloyd’s, the PRA and the FCA.
• The syndicate operates in the insurance industry which is a highly regulated environment. As such
the Senior Statutory Auditor considered the experience and expertise of the engagement team to
ensure that the team had the appropriate competence and capabilities, which included the use of
specialists where appropriate.
• We assessed the susceptibility of the syndicate’s annual accounts to material misstatement,
including how fraud might occur by considering the controls that the directors of the managing
agent have established to address risks identified by them, or that otherwise seek to prevent,
deter or detect fraud. We also considered areas of significant judgement, complex transactions,
performance targets, economic or external pressures and the impact these have on the control
environment. Where this risk was considered to be higher, we performed audit procedures to
address each identified fraud risk, including;
â—¦ Reviewing accounting estimates for evidence of management bias. Supported by our
Actuaries, we assessed if there were any indicators of management bias in the valuation of
insurance liabilities and the recognition of estimated premium income.
â—¦ Evaluating the business rationale for significant and/or unusual transactions.
â—¦ Testing the appropriateness of journal entries recorded in the general ledger, particularly
in respect of judgemental areas including valuation of insurance liabilities and estimated
premium income.
A further description of our responsibilities for the audit of the annual accounts is located on the Financial
Reporting Council’s website at https://www.frc.org.uk/auditorsresponsibilities. This description forms part
of our auditor’s report.
Other matter
Our opinion on the syndicate annual accounts does not cover the iXBRL tagging included within these
syndicate annual accounts, and we do not express any form of assurance conclusion thereon.
Use of our report
This report is made solely to the syndicate’s members, as a body, in accordance with The Insurance
Accounts Directive (Lloyd’s Syndicate and Aggregate Accounts) Regulations 2008. Our audit work has been
undertaken so that we might state to the syndicate’s members those matters we are required to state to
them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not
accept or assume responsibility to anyone other than the syndicate and the syndicate’s members as a
body, for our audit work, for this report, or for the opinions we have formed.
Niamh Byrne (Senior statutory auditor)
for and on behalf of Ernst & Young LLP, Statutory Auditor
London
SYNDICATE 3623
31 DECEMBER 2025
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF SYNDICATE 3623
18
20 February 2026
2025 2024
Notes $'000 $'000
Gross premiums written
3 432,120 1,335,977
Outward reinsurance premiums (7,792 ) (246,281 )
Premiums written, net of reinsurance 424,328 1,089,696
Changes in unearned premium
Change in the gross provision for unearned premiums
14 446,258 (654,954 )
Change in the provision for unearned premiums, reinsurers’
share
14 (115,810 ) 137,382
Net change in the provisions for unearned premiums 330,448 (517,572 )
Earned premiums, net of reinsurance 754,776 572,124
Allocated investment return transferred from the
non-technical account
7 36,684 16,861
Claims paid
Gross amount
14
(245,295 ) (105,879 )
Reinsurers’ share
14
Net claims paid (160,022 ) (50,174 )
Change in the provision for claims
Gross amount 14 (216,588 ) (224,206 )
Reinsurers' share 14 (49,882 ) (21,766 )
Net change in provisions for claims (266,470 ) (245,972 )
Claims incurred, net of reinsurance (426,492 ) (296,146 )
Net operating expenses 4
(290,692 ) (224,636 )
Balance on the technical account - general business 74,276 68,203
Investment income 7 24,171 15,457
Realised gain/(loss) on investments 7
Unrealised gains on investments 7
Investment expenses and charges 7 (191 ) (5,126 )
Total investment return
Allocated investment return transferred to technical
account
(36,684 ) (16,861 )
Gain/(loss) on foreign exchange 3,223 (2,295 )
Other income 68 —
Profit for the financial year
Total comprehensive income for the financial year
There were no other comprehensive gains or losses in the year.
The notes on pages 23 to 48 form part of these financial statements.
SYNDICATE 3623
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2025
19
| 2025 | 2024 | ||
| Assets | Notes | $'000 | $'000 |
Investments | |||
| Financial investments | 9 | | |
| Deposits with ceding undertakings | | | |
| | | ||
Reinsurers' share of technical provisions | |||
| Provision for unearned premiums | 14 | | |
| Claims outstanding | 14 | | |
| | | ||
Debtors | |||
Debtors arising out of direct insurance operations | 10 | | |
Debtors arising out of reinsurance operations | 11 | | |
| Other debtors | 12 | | |
| | | ||
Other assets | |||
| Cash at bank and in hand | 18 | | |
| | | ||
Prepayments and accrued income | |||
| Deferred acquisition costs | 13 | | |
| Other prepayments and accrued income | | | |
| | | ||
| Total assets | | | |
Capital and reserves | |||
| Members' balances | | | |
| | | ||
Liabilities | |||
Technical provisions | |||
| Provision for unearned premiums | 14 | | |
| Claims outstanding | 14 | | |
| | | ||
Creditors | |||
Creditors arising out of direct insurance operations | 15 | | |
Creditors arising out of reinsurance operations | 16 | | |
Other creditors | 17 | | |
| | | ||
| Accruals and deferred income | | | |
| Total liabilities | | | |
| Total liabilities, capital and reserves | | |
The notes on pages 23 to 48 form part of these financial statements.
The syndicate annual accounts on pages 19 to 48 were approved and authorised for issue by the board of
Beazley Furlonge Limited on 19 February 2026 and were signed on its behalf by
………………………
C C J Wong (Director)
SYNDICATE 3623
BALANCE SHEET
AS AT 31 DECEMBER 2025
20
| 2025 | 2024 | |
| $'000 | $'000 | |
Members’ balances brought forward at 1 January | | |
Total comprehensive income for the financial year | | |
Payments of profit to members' personal reserve funds | ( | ( |
Members’ balances carried forward at 31 December | | |
Members participate in syndicates by reference to years of account (‘YoA’) and their ultimate result, assets
and liabilities are assessed with reference to policies incepting in that YoA in respect of their membership
of a particular year.
The notes on pages 23 to 48 form part of these financial statements.
SYNDICATE 3623
STATEMENT OF CHANGES IN MEMBER’S BALANCES
FOR THE YEAR ENDED 31 DECEMBER 2025
21
| 2025 | 2024 | ||
| Notes | $'000 | $'000 | |
Cash flows from operating activities | |||
Profit for the financial year | | | |
Adjustments for: | |||
(Decrease)/increase in gross technical provisions | 14 | ( | |
Decrease)/(increase) in reinsurers' share of gross technical provisions | 14 | | ( |
Decrease/(increase) in debtors | | ( | |
(Decrease) /increase in creditors | ( | | |
Movement in other assets/liabilities | | ( | |
| Investment return | 7 | ( | ( |
Foreign exchange | ( | | |
Net cash flows from operating activities | | | |
Cash flows from investing activities | |||
Purchase of equity and debt securities | ( | ( | |
Sale of equity and debt securities | | | |
Investment income received | | | |
Net cash flows from investing activities | ( | ( | |
Cash flows from financing activities | |||
Distribution of profit | ( | ( | |
Net cash flows from financing activities | ( | ( | |
Net (decrease)/increase in cash and cash equivalents | ( | | |
Cash and cash equivalents at the beginning of the year | | | |
Foreign exchange on cash and cash equivalents | | ( | |
| Cash and cash equivalents at the end of the year | 18 | | |
The notes on pages 23 to 48 form part of these financial statements.
SYNDICATE 3623
STATEMENT OF CASH FLOWS
YEAR ENDED 31 DECEMBER 2025
22
1. Accounting policies
Basis of preparation
Syndicate 3623 (the ‘syndicate’) comprises a group of members of the Society of Lloyd’s that underwrites
insurance business in the London Market. The managing agent of the syndicate is Beazley Furlonge Limited
(’BFL'), whose registered address and principal place of business is 22 Bishopsgate, London, EC2N 4BQ.
The ultimate controlling party of BFL is Beazley plc, a company incorporated in England and Wales.
These syndicate annual accounts have been prepared in accordance with the Insurance Accounts Directive
(Lloyd’s Syndicate and Aggregate Accounts) Regulations 2008, applicable Accounting Standards in the
United Kingdom and the Republic of Ireland, including Financial Reporting Standard 102 (FRS 102),
Financial Reporting Standard 103 (FRS 103) in relation to insurance contracts, and the Lloyd's Syndicate
Accounts Instructions Version 3.1 as modified by the Frequently Asked Questions version 1.1 issued by
Lloyd’s.
The financial statements have been prepared on the historic cost basis, except for financial assets at fair
value through profit or loss which are measured at fair value. All amounts presented are stated in US
dollars, being the syndicate’s functional currency, and in thousands, unless noted otherwise.
Going concern
The financial statements of the syndicate have been prepared on a going concern basis. The syndicate's
business activities, together with the factors likely to affect its future development, performance and
position, are set out in the Strategic report of the managing agent on pages 4 - 5. In addition, note 2
includes the syndicate's risk management objectives and the managing agent’s objectives, policies and
processes for managing its capital. The syndicate has sufficient capital for each year of account in its Funds
at Lloyd’s (FAL). There is no intention to cease underwriting or cease the operations of the syndicate.
In assessing the syndicate's going concern position as at 31 December 2025, the managing agent has
considered a number of factors, including the current statement of financial position and the syndicate's
strategic and financial plan. The assessment concluded that, given the intention to partake in the 2026
YoA, the syndicate has sufficient capital and liquidity for the 12 months from the date that the financial
statements are authorised for issue.
Use of estimates and judgements
The preparation of financial statements requires the use of estimates and judgements that affect the
reported amounts of assets, liabilities, income and expenses. Actual results may differ from those on which
management’s estimates are based. Estimates and assumptions are continually evaluated and are based
on historical experience and other factors. For example, estimates which are sensitive to economic,
regulatory and geopolitical conditions could be impacted by significant changes in the external
environment such as the volatile macroeconomic environment, climate change, international conflicts, and
significant changes in legislation. Any revisions to accounting estimates are recognised in the period in
which the estimate is revised and in any future periods affected.
Specific to climate change, since responses to it are still developing, it is not possible to consider all
possible future outcomes when determining asset and liability valuations, and timing of future cash flows,
as these are not yet known. Nevertheless, the current management view is that reasonably possible
changes arising from climate risks would not have a material impact on asset and liability valuations at the
year-end date.
(a) Valuation of insurance contract liabilities
The most critical estimate included within the syndicate’s balance sheet is the estimate for insurance losses
incurred but not reported (‘IBNR’) which is included within total technical provisions and reinsurers’ share
of technical provisions in the balance sheet and note 14. This estimate is critical as it outlines the current
liability for future expenses expected to be incurred in relation to claims. If this estimation was to prove
inadequate then an exposure would arise in future years where a liability has not been provided for.
SYNDICATE 3623
NOTES TO THE FINANCIAL STATEMENTS
YEAR ENDED 31 DECEMBER 2025
23
23
1. Accounting policies continued
The best estimate of the most likely ultimate outcome is used when calculating notified claims. This
estimate is based upon the facts available at the time, in conjunction with the claims manager’s view of
likely future developments. The total estimate of gross IBNR as at 31 December 2025 included within
claims outstanding is $707,491k (2024: $558,573k).
(b) Valuation of unquoted and illiquid financial assets
Determination of fair value of unquoted and illiquid assets involves judgement in model valuations,
through the incorporation of both observable and unobservable market inputs. These inputs include
assumptions that lead to the existence of a range of plausible valuations. Further detail on the
methodologies and inputs used is described in note 9.
(c) Premium estimates
Premium written is initially based on the estimated premium income (‘EPI’) of each contract. Where
premium is sourced through binders, the binder EPI is pro-rated across the binder period. Judgement is
involved in determining the ultimate estimates in order to establish the appropriate premium value and,
ultimately, the cash to be received. EPI estimates are updated to reflect changes in underwriters'
expectations through consultation with brokers and third-party coverholders, changes in market
conditions, historic experience and to reflect actual cash received for a contract.
Due to the nature of Lloyd’s business and the settlement patterns of the underlying business it is also not
uncommon for some contracts to take a number of years to finalise and settle, and a receivable on the
balance sheet remains. The amount of estimated future premium that remains in insurance receivables
relating to years of account that are more than three years developed at 31 December 2025 is $3,117k
(2024: $652k).
Significant accounting policies
The financial statements have been prepared on an annual basis of accounting, whereby the incurred cost
of claims, commissions and related expenses are charged against the earned proportion of premiums, net
of reinsurance as follows:
(a) Premiums written
Gross premiums written comprise premiums on contracts incepted during the financial year together with
adjustments to premiums written in previous accounting periods and estimates for premiums from
contracts entered into during the course of the year. Gross written premiums are stated before the
deduction of brokerage, taxes and duties levied on premiums and other deductions.
(b) Unearned premiums
A provision for unearned premiums represents that part of the gross premiums written that is estimated
will be earned in the following or subsequent financial periods. It is calculated using the daily pro rata
method, under which the premium is apportioned over the period of risk.
(c) Claims provisions and related reinsurance recoveries
Claims represent the cost of claims and claims handling expenses paid during the financial year, together
with the movement in provisions for outstanding claims, IBNR and future claims handling provisions. The
provision for claims outstanding comprises amounts set aside for claims advised and IBNR.
The IBNR amount is based on estimates calculated using widely accepted actuarial techniques (e.g. chain
ladder) which are reviewed quarterly by the group actuary and annually by the independent syndicate
reporting actuary. The techniques generally use projections, based on past experience of the development
of claims over time, to form a view on the likely ultimate claims to be experienced. For more recent
underwriting, regard is given to the variations in the business portfolio accepted and the underlying terms
and conditions. Thus, the critical assumptions used when estimating claims provisions are that the past
experience is a reasonable predictor of likely future claims development and that the rating and other
models used to analyse current business are a fair reflection of the likely level of ultimate claims to be
incurred.
SYNDICATE 3623
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
YEAR ENDED 31 DECEMBER 2025
24
1. Accounting policies continued
A provision is made at the year-end for the estimated cost of claims incurred but not settled at the balance
sheet date, including the cost of claims incurred but not yet reported to the managing agent. The
managing agent takes all reasonable steps to ensure that it has appropriate information regarding its
claims exposures. However, given the uncertainty in establishing claims provisions, it is likely that the final
outcome will prove to be different from the original liability established.
(d) Liability adequacy testing
At each reporting date, liability adequacy tests are performed to ensure the adequacy of the claims
liabilities net of deferred acquisition costs and unearned premium reserves. In performing these tests,
current best estimates of future contractual cash flows, claims handling and administration expenses as
well as investment income from the assets backing such liabilities are used.
Any deficiency is subsequently charged to the statement of comprehensive income and a liability for
unexpired risk provision is established.
(e) Acquisition costs
Acquisition costs comprise brokerage, premium levies, and staff related costs of the underwriters acquiring
the business. The proportion of acquisition costs in respect of unearned premiums is deferred at the
balance sheet date and recognised in later periods when the related premiums are earned.
(f) Foreign currencies
Foreign currency transactions are translated into the functional currency using average exchange rates
applicable to the period in which the transactions take place and where the syndicate considers these to be
a reasonable approximation of the transaction rate. Foreign exchange gains and losses resulting from the
settlement of such transactions and from translation at the period end of monetary assets and liabilities
denominated in foreign currencies are recognised in the statement of comprehensive income.
(g) Investment return
Investment return comprises all investment income, realised investment gains and losses and movements
in unrealised gains and losses, net of investment expenses, charges and interest.
Realised gains and losses on investments carried at market value are calculated as the difference between
sale proceeds and the original cost of the investment. Movements in unrealised gains and losses on
investments represent the difference between the valuation at the balance sheet date, and the valuation at
the previous period end or purchase value during the period.
Investment return is initially recorded in the non-technical account. A transfer is made from the non-
technical account to the general business technical account to reflect the investment return on funds
supporting underwriting business.
(h) Ceded reinsurance
These are contracts entered into by the syndicate with reinsurers under which the syndicate is
compensated for losses on contracts issued by the syndicate and that meet the definition of an insurance
contract. Insurance contracts entered into by the syndicate under which the contract holder is another
insurer (‘inwards reinsurance’) are included with insurance contracts.
Any benefits to which the syndicate is entitled under its reinsurance contracts held are recognised as
reinsurance assets. These consist of balances due from reinsurers relating to claims and also includes the
provision for unearned premiums, reinsurers’ share. Balances due relating to the reinsurers share of claims
are based on calculated amounts of outstanding claims recoveries and projections for IBNR, net of
estimated irrecoverable amounts having regard to the reinsurance programme in place for the class of
business, the claims experience for the period and the current security rating of the reinsurer involved.
Reinsurance liabilities are primarily premiums payable for reinsurance contracts and are recognised as an
expense when due.
Reinsurance assets are assessed for impairment at each reporting date. If there is objective evidence of
impairment, then the carrying amount is reduced to its recoverable amount and the impairment loss is
recognised in statement of comprehensive income.
SYNDICATE 3623
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
YEAR ENDED 31 DECEMBER 2025
25
1. Accounting policies continued
(i) Financial instruments
Recognition and derecognition
Financial instruments are recognised on the balance sheet at such time that the syndicate becomes a party
to the contractual provisions of the financial instrument. A financial asset is derecognised when:
• the contractual rights to receive cash flows from the financial assets expire;
• the financial assets have been transferred, together with substantially all the risks and rewards of
ownership; or
• despite having retained some, but not substantially all, risks and rewards of ownership, control of
the asset is transferred to another party and the other party has the practical ability to sell the
asset in its entirety to an unrelated third party.
Financial liabilities are derecognised if the syndicate’s obligations specified in the contract expire, are
discharged or cancelled.
Financial assets and liabilities measurement
On acquisition of a financial asset or liability, the asset or liability is measured at the transaction price,
except for those financial assets and liabilities at FVTPL, which are initially measured at fair value. The
exception to this is when the arrangement constitutes a financing transaction however, the syndicate does
not make use of any such arrangements.
Except for derivative financial investments, all financial investments are designated as FVTPL upon initial
recognition because they are managed and their performance is evaluated on a fair value basis.
Information about these financial instruments is provided internally on a fair value basis to key
management. The investment strategy is to invest and evaluate their performance with reference to their
fair values.
Fair value measurement
Fair value is the price at which an orderly transaction to sell an asset or to transfer a liability would take
place between market participants at the measurement date. Fair value is a market-based measure and in
the absence of observable market prices in an active market, it is measured using the assumptions that
market participants would use when pricing the asset or liability.
The best evidence of the fair value of a financial instrument at initial recognition is the transaction price,
i.e., the fair value of the consideration given or received, unless the fair value of that instrument is
evidenced by comparison with other observable current market transactions in the same instrument (i.e.,
without modification or repackaging) or based on a valuation technique whose variables include only data
from observable markets.
When transaction price provides the best evidence of fair value at initial recognition, the financial
instrument is initially measured at the transaction price and any difference between this price and the
value initially obtained from a valuation model is subsequently recognised in statement of comprehensive
income depending on the individual facts and circumstances of the transaction but not later than when the
valuation is supported wholly by observable market data or the transaction is closed out.
Upon initial recognition, attributable transaction costs relating to financial instruments at fair value through
the income statement are recognised in statement of comprehensive income when incurred. Financial
assets at FVTPL are measured at fair value, and changes therein are recognised in the statement of
comprehensive income. Net changes in the fair value of financial assets at FVTPL exclude interest and
dividend income, as these items are accounted for separately.
(j) Insurance debtors and creditors
Insurance debtors and creditors include amounts due to and from agents, brokers and insurance contract
holders. These are classified as debt instruments as they are non-derivative financial assets with fixed or
determinable payments that are not quoted on an active market. Insurance debtors are measured at
amortised cost less any provision for impairment. Insurance creditors are stated at amortised cost. The
syndicate does not have any debtors directly with policyholders, all transactions occur via an intermediary.
For information on reinsurance debtors and creditors, refer to Section (h) above.
(k) Other debtors
Other debtors principally consist of intercompany debtor balances and sundry debtors and are carried at
amortised cost less any impairment losses.
SYNDICATE 3623
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
YEAR ENDED 31 DECEMBER 2025
26
1. Accounting policies continued
(l) Other creditors
Other creditors principally consist of amounts due to Syndicate 2623 and 6107, and other related entities.
These are stated at amortised cost determined using the effective interest rate method.
(m) Impairment of financial assets
Assessment is made at each reporting date whether there is objective evidence that a financial asset or
group of financial assets measured at amortised cost is impaired. A financial asset or group of financial
assets is impaired and impairment losses are incurred only if there is objective evidence of impairment as
a result of one or more events that have occurred after the initial recognition of the assets and that event
has an impact on the estimated cash flows of the financial asset or group of financial assets that can be
reliably estimated.
If there is objective evidence that impairment exists, the amount of the loss is measured as the difference
between the assets carrying amount and the value of the estimated future cash flows discounted at the
financial asset’s original effective interest rate. Where a loss is incurred this is recognised in the statement
of comprehensive income.
(n) Cash and cash equivalents
Cash and cash equivalents are comprised of cash at bank and in hand, in addition to deposits held at call
with banks and other short-term highly liquid investments with maturities of three months or less from the
acquisition date. Only cash at bank and in hand is presented separately on the face of the balance sheet,
while cash equivalents are included within the 'financial investments' line. Cash and cash equivalents are
shown in aggregate on the cash flow statement and at note 18. These are carried at amortised cost less
impairment losses.
(o) 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 (currently at 20%) 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 have been included in the
balance sheet under the heading ‘other debtors’.
No provision has been made for any other overseas tax payable by members on underwriting results.
(p) Pension costs
Pension contributions relating to staff who act on behalf of the syndicate are charged to the syndicate and
included within net operating expenses.
(q) Related party transactions
The syndicate has taken advantage of the exemption contained in FRS 102.1 and has therefore not
disclosed transactions with other wholly owned entities forming part of the Beazley Group.
SYNDICATE 3623
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
YEAR ENDED 31 DECEMBER 2025
27
2 Risk management
The syndicate has identified the risks arising from its activities and has established policies and procedures
to manage these items in accordance with its risk appetite. The sections below outline the syndicate’s risk
appetite and explain how the managing agent defines and manages each category of risk. The risk
management framework is discussed in the managing agent's report.
2.1 Insurance risk
The syndicate’s insurance business assumes the risk of loss from persons or organisations that are directly
exposed to an underlying loss. Insurance risk arises from this risk transfer due to inherent uncertainties
about the occurrence, amount and timing of insurance liabilities. The four key components of insurance
risk are underwriting, reinsurance, claims management and reserving. Each element is considered below.
a) Underwriting risk
Underwriting risk comprises four elements that apply to all insurance products offered by the syndicate:
• cycle risk – the risk that business is written without full knowledge as to the (in)adequacy of rates,
terms and conditions;
• event risk – the risk that individual risk losses or catastrophes lead to claims that are higher than
anticipated in plans and pricing;
• pricing risk – the risk that the level of expected loss is understated in the pricing process; and
• expense risk – the risk that the allowance for expenses and inflation in pricing is inadequate.
The managing agent manage and model these four elements in the following three categories: attritional
claims, large claims and catastrophe events.
The syndicate’s underwriting strategy is to seek a diverse and balanced portfolio of risks in order to limit
the variability of outcomes. This is achieved by accepting a spread of business over time, segmented
between different products, geography and size.
The annual business plans for each underwriting team reflect the syndicate’s underwriting strategy, and
set out the classes of business, the territories and the industry sectors in which business is to be written.
These plans are approved by the Board of BFL and monitored by the Underwriting Committee.
The managing agents’s underwriters calculate premiums for risks written based on a range of criteria
tailored specifically to each individual risk. These factors include but are not limited to the financial
exposure, loss history, risk characteristics, limits, deductibles, terms and conditions and acquisition
expenses. The managing agent also recognises that insurance events are, by their nature, random, and
the actual number and size of events during any one year may vary from those estimated using
established statistical techniques.
To address this, the managing agent sets out the exposure that it is prepared to accept in certain
territories to a range of events such as natural catastrophes and specific scenarios which may result in
large industry losses. This is monitored through regular calculation of Realistic Disaster Scenarios. The
aggregate position is monitored at the time of underwriting a risk, and reports are regularly produced to
highlight the key aggregations to which the syndicate is exposed.
The managing agent uses a number of modelling tools to monitor its exposures against the agreed risk
appetite set and to simulate catastrophe losses in order to measure the effectiveness of its reinsurance
programmes.
Stress and scenario tests are also run using these models. The range of scenarios considered includes
natural catastrophe, cyber, marine, liability, political, terrorism and war events.
One of the largest types of event exposure relates to natural catastrophe events such as wind storm or
earthquake. With the increasing risk from climate change impacting the frequency and severity of natural
catastrophes, the managing agent continues to monitor its exposure. Where possible the managing agent
measures geographic accumulations and uses its knowledge of the business, historical loss behaviour and
commercial catastrophe modelling software to assess the expected range of losses at different return
periods. Upon application of the reinsurance coverage purchased, the key gross and net exposures are
calculated on the basis of extreme events at a range of return periods.
SYNDICATE 3623
NOTES TO THE FINANCIAL STATEMENTS
YEAR ENDED 31 DECEMBER 2025
28
28
2 Risk management continued
To manage underwriting exposures, the managing agent developed limits of authority and business plans
which are binding upon all staff authorised to underwrite and are specific to underwriters, classes of
business and industry.
These authority limits are enforced through a comprehensive sign-off process for underwriting transactions
including dual sign-off for all line underwriters and peer review for all risks exceeding individual
underwriters authority limits. Exception reports are also run regularly to monitor compliance.
All underwriters also have a right to refuse renewal or change the terms and conditions of insurance
contracts upon renewal. Rate monitoring details, including limits, deductibles, exposures, terms and
conditions and risk characteristics are also captured and the results are combined to monitor the rating
environment for each class of business.
Binding authority contracts
A proportion of the syndicate’s insurance risks are transacted by third parties under delegated underwriting
authorities. Each third party is thoroughly vetted by the managing agent's coverholder approval group
before it can bind risks, and is subject to rigorous monitoring to maintain underwriting quality and confirm
ongoing compliance with contractual guidelines.
b) Reinsurance risk
Reinsurance risk to the syndicate arises where reinsurance contracts put in place to reduce gross insurance
risk do not perform as anticipated, result in coverage disputes or prove inadequate in terms of the vertical
or horizontal limits purchased. Failure of a reinsurer to pay a valid claim is considered a credit risk which is
detailed separately below.
The syndicate’s reinsurance programmes complement the underwriting team's business plans and seek to
protect syndicate capital from an adverse volume or volatility of claims on both a per risk and per event
basis. In some cases the syndicate deems it more economic to hold capital than purchase reinsurance.
These decisions are regularly reviewed as an integral part of the business planning and performance
monitoring process.
The Reinsurance Security Committee examines and approves all reinsurers to ensure that they possess
suitable security. The syndicate’s ceded reinsurance team ensures that these guidelines are followed,
undertakes the administration of reinsurance contracts, monitors and instigates our responses to any
erosion of the reinsurance programmes.
c) Claims management risk
Claims management risk may arise within the syndicate in the event of inaccurate or incomplete case
reserves and claims settlements, poor service quality or excessive claims handling costs. These risks may
damage the Beazley brand and undermine its ability to win and retain business or incur punitive damages.
These risks can occur at any stage of the claims life-cycle.
The managing agent’s claims teams are focused on delivering quality, reliability and speed of service to
both internal and external clients. Their aim is to adjust and process claims in a fair, efficient and timely
manner, in accordance with the policy’s terms and conditions, the regulatory environment, and the
business’s broader interests. Prompt and accurate case reserves are set for all known claims liabilities,
including provisions for expenses.
d) Reserving and ultimate reserves risk
Reserving and ultimate reserves risk occurs within the syndicate where established insurance liabilities are
insufficient through inaccurate forecasting, or where there is inadequate allowance for expenses and
reinsurance bad debts in provisions.
To manage reserving and ultimate reserves risk, the managing agent's actuarial team uses a range of
recognised techniques to project gross premiums written, monitor claims development patterns and stress
test ultimate insurance liability balances. An external independent actuary also performs an annual review
to produce a statement of actuarial opinion for the syndicate.
The objective of the syndicate’s reserving policy is to produce accurate and reliable estimates that are
consistent over time and across classes of business. The estimates of gross premiums written and claims
prepared by the actuarial department are used through a formal quarterly peer review process to
independently test the integrity of the estimates produced by the underwriting teams for each class of
SYNDICATE 3623
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
YEAR ENDED 31 DECEMBER 2025
29
2 Risk management continued
business. These meetings are attended by senior management, senior underwriters, actuarial, claims, and
finance representatives.
An increase or decrease in total claims liabilities would have the following impact on profit and members'
balances':
Sensitivity to insurance risk (claims reserves)
Impact on profit and members'
balances
2025
$'000
2024
$'000
Claims outstanding - gross of reinsurance
909,282 685,670
Claims outstanding - net of reinsurance
673,213 405,714
5% increase in gross claims reserve
(45,464 ) (34,284 )
5% decrease in gross claims reserve
5% increase in net claims reserve
(33,661 ) (20,286 )
5% decrease in net claims reserve
The syndicate monitors its exposure to insurance risk by location. The geographical breakdown of written
premiums is disclosed in note 3.
2.2 Market risk
Market risk arises where the value of assets and liabilities changes as a result of movements in foreign
exchange rates, interest rates and market prices.
Foreign exchange risk
The functional and presentational currency of the syndicate is the US dollar. The effect of this on foreign
exchange risk is that the syndicate is exposed to fluctuations in exchange rates for non-dollar denominated
transactions and net assets.
The syndicate deals in four main settlement currencies: US dollars, sterling, Canadian dollars and euros.
Transactions in all currencies are converted to US dollars on initial recognition and revalued at the
reporting date. Remaining foreign exchange risk is still actively managed as described below.
The following table summarises the carrying value of total assets and total liabilities categorised by
currency:
31 December
2025
UK £
$'000
US $
$'000
EUR €
$'000
CAD $
$'000
AUD $
$'000
Other
$'000
Total
$'000
Investments 159 646,073 13 209,040 3,071 3,060 861,416
Reinsurers' share of
technical provisions 24,682 211,289 10,723 16,082 — — 262,776
Debtors 10,386 214,551 1,048 26,185 — — 252,170
Other assets 362 1,546 319 132 — — 2,359
Prepayments and
accrued income (567 ) 62,475 (3,772 ) 21,519 — — 79,655
Total assets
Technical provisions (50,978 ) (936,447 ) (13,080 ) (128,268 ) — — (1,128,773 )
Creditors
Accruals and deferred
income (14,468 ) (2,104 ) — (591 ) — — (17,163 )
Total liabilities (60,426 ) (1,132,568 ) (19,276 ) (131,601 ) — — (1,343,871 )
Total Capital and
Reserves 25,404 (3,366 ) 10,945 (141,357 ) (3,071 ) (3,060 ) (114,505 )
SYNDICATE 3623
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
YEAR ENDED 31 DECEMBER 2025
30
2 Risk management continued
UK £
$'000
US $
$'000
EUR €
$'000
CAD $
$'000
AUD $
$'000
Other
$'000
Total
$'000
Investments 2,493 578,800 9 91,221 12,581 9,392 694,496
Reinsurers' share of
technical provisions 57,760 297,269 33,438 33,876 — — 422,343
Debtors 25,348 327,049 34,076 8,459 — — 394,932
Other assets 875 127,504 196 263 — — 128,838
Prepayments and
accrued income 937 201,599 695 12,079 — — 215,310
Total assets
Technical provisions (61,420 ) (1,179,722 ) (20,454 ) (88,151 ) — — (1,349,747 )
Creditors
(27,725 ) (315,937 ) (37,122 ) (14,998 ) — — (395,782 )
Accruals and deferred
income (10,669 ) (10,412 ) — (707 ) — — (21,788 )
Total liabilities (99,814 ) (1,506,071 ) (57,576 ) (103,856 ) — — (1,767,317 )
Total Capital and
Reserves 12,401 (26,150 ) (10,838 ) (42,042 ) (12,581 ) (9,392 ) (88,602 )
Sensitivity analysis - foreign exchange risk
In 2025, the managing agent managed the syndicate's foreign exchange risk by periodically assessing its
non-dollar exposures while targeting net assets to be predominately US dollar denominated. On a forward
looking basis an assessment is made of expected future exposure development and appropriate currency
trades put in place to reduce risk.
Fluctuations in the syndicate’s trading currencies against the US dollar would result in a change to profit
and members' balances. The table below gives an indication of the impact on profit and members' balances
of a percentage change in relative strength of US dollar against the value of sterling, Canadian dollar, euro
and Australian dollar, simultaneously.
Impact on profit and members'
balances
Change in exchange rate of Australian dollar, Canadian dollar, euro and
sterling, relative to US dollar
2025
$'000
2024
$'000
Dollar weakens 10% against other currencies
9,825 4,824
Dollar strengthens 10% against other currencies
(9,825) (4,824)
Interest rate risk
Some of the syndicate’s financial instruments, including financial investments and cash and cash
equivalents are exposed to movements in market interest rates.
The managing agent manages interest rate risk by primarily investing in short duration financial
investments and cash and cash equivalents. The Investment Committee monitors the duration of these
assets on a regular basis.
The following table shows the average duration at the reporting date of the financial instruments that are
exposed to movements in market interest rates. Duration is a commonly used measure of volatility and
this gives a better indication than maturity of the likely sensitivity of our portfolio to changes in interest
rates.
SYNDICATE 3623
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
YEAR ENDED 31 DECEMBER 2025
31
2 Risk management continued
Duration <1 yr 1-2 yrs 2-3 yrs 3-4 yrs 4-5 yrs 5-10 yrs >10 yrs
Total
31 December
2025
$'000 $'000 $'000 $'000 $'000 $'000 $'000
$'000
Debt securities
and other fixed
income securities
245,098 284,308 150,763 29,521 10,058 20,684 — 740,432
Participation in
investment pools
16,274 — — — — — — 16,274
Shares and other
variable yield
securities and unit
trusts*
— — — 39,560 — — — 39,560
Other investments 35,471 — — — — — — 35,471
Cash at bank and
in hand
2,359 — — — — — — 2,359
Syndicate loans to
central fund
— — — — — — — —
Total 299,202 284,308 150,763 69,081 10,058 20,684 —
834,096
*Only high yield debt securities have been included here. Equity securities have been excluded.
Duration <1 yr 1-2 yrs 2-3 yrs 3-4 yrs 4-5 yrs 5-10 yrs >10 yrs Total
31 December
2024
$'000 $'000 $'000 $'000 $'000 $'000 $'000 $'000
Debt securities
and other fixed
income securities
180,521 218,642 136,577 24,252 15,481 — — 575,473
Participation in
investment pools
25,641 — — — — — — 25,641
Shares and other
variable yield
securities and unit
trusts*
— — — 27,306 — — — 27,306
Other investments 35,315 — — — — — — 35,315
Cash at bank and
in hand
128,838 — — — — — — 128,838
Syndicate loans to
central fund
2,470 — — — — — — 2,470
Total
372,785 218,642 136,577 51,558 15,481 — — 795,043
*Only high yield debt securities have been included here. Equity securities have been excluded.
Sensitivity analysis - interest rate risk
The syndicate holds financial assets and liabilities that are exposed to interest rate risk. Changes in
interest yields, with all other variables constant, would result in changes in the capital value of debt and
derivative financial instruments. This will affect reported profits and members' balances as indicated in the
table on the following page.
SYNDICATE 3623
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
YEAR ENDED 31 DECEMBER 2025
32
2 Risk management continued
Impact on profit for the year Impact on members' balances
Shift in yield (basis
points)
2025
$'000
2024
$'000
2025
$'000
2024
$'000
50 basis point increase (7,011 ) (5,381 ) (7,011 ) (5,381 )
50 basis point decrease 7,011 5,381 7,011 5,381
Price risk
Financial assets that are recognised on the balance sheet at their fair value are susceptible to losses due to
adverse changes in prices. This is referred to as price risk.
Financial assets include fixed and floating debt securities, which are well diversified across high quality,
liquid securities. The price risk associated with these securities is predominantly interest, foreign exchange
and credit risk related. The Investment Committee has established comprehensive guidelines with
investment managers setting out maximum investment limits, diversification across industries and
concentrations in any one industry or company.
Listed investments are recognised on the balance sheet at quoted bid price. If the market for the
investment is not considered to be active, then the syndicate establishes fair value using valuation
techniques. This includes using recent arm’s length market transactions, reference to current fair value of
other investments that are substantially the same, discounted cash flow models and other valuation
techniques that are commonly used by market participants.
Impact on profit for
the year
Impact on members
balances
Change in fair value of hedge funds, equity
linked funds and illiquid credit assets
2025
$'000
2024
$'000
2025
$'000
2024
$'000
5% increase in fair value
5% decrease in fair value
(1,483 ) (1,412 ) (1,483 ) (1,412 )
2.3 Credit risk
Credit risk arises from the failure of another party to perform its financial or contractual obligations to the
syndicate in a timely manner. The primary sources of credit risk for the syndicate are:
• reinsurers – whereby reinsurers may fail to pay valid claims against a reinsurance contract held by
the syndicate;
• brokers and coverholders – whereby counterparties fail to pass on premiums or claims collected or
paid on behalf of the syndicate;
• investments – whereby issuer default results in the syndicate losing all or part of the value of a
financial instrument and derivative financial instrument; and
• cash at bank and in hand.
The syndicate’s core business is to accept significant insurance risk and the appetite for other risks is low.
This protects the syndicate’s capital from erosion so that it can meet its insurance liabilities. The
managing agent limits the syndicate's exposure to a single counterparty or a group of counterparties and
analyses the geographical locations of exposures when assessing credit risk.
An approval system also exists for all new brokers, and broker performance is carefully monitored. Regular
exception reports highlight trading with non-approved brokers, and the syndicate’s credit control function
frequently assesses the ageing and collectability of debtor balances. Any large, aged items are prioritised
and where collection is outsourced, incentives are in place to support these priorities.
The Investment Committee has established comprehensive guidelines for the syndicate’s investment
managers regarding the type, duration and quality of investments acceptable to the syndicate. The
performance of investment managers is regularly reviewed to confirm adherence to these guidelines.
The managing agent has developed processes to formally examine all reinsurers before entering into new
business arrangements. New reinsurers are approved by the Reinsurance Security Committee, which also
reviews arrangements with all existing reinsurers at least annually. Vulnerable or slow-paying reinsurers
are examined more frequently. The tables on the following page summarise the syndicate’s concentrations
of credit risk.
SYNDICATE 3623
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
YEAR ENDED 31 DECEMBER 2025
33
2 Risk management continued
31 December 2025
AAA
$'000
AA
$'000
A
$'000
BBB
$'000
Other
$'000
Not
rated
$'000
Total
$'000
Investments
Shares and other variable yield
securities and units in unit
trusts
Debt securities and other fixed
income securities
Participation in investment
pools
Syndicate loans to central fund
Other investments
Deposits with ceding
undertakings
Total investments
367,047 12,284 355,590 57,279 39,560 29,656 861,416
Reinsurers’ share of
outstanding claims
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
31 December 2024
AAA
$'000
AA
$'000
A
$'000
BBB
$'000
Other
$'000
Not
rated
$'000
Total
$'000
Investments
Shares and other variable yield
securities and units in unit
trusts
Debt securities and other fixed
income securities
Participation in investment
pools
Syndicate loans to central fund
Other investments
Deposits with ceding
undertakings
Total investments
68,900 229,390 258,328 82,334 27,305 28,239 694,496
Reinsurers’ share of outstanding
claims
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
SYNDICATE 3623
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
YEAR ENDED 31 DECEMBER 2025
34
2 Risk management continued
The syndicate has insurance debtors and reinsurance assets that are past due but not impaired at the
reporting date. An aged analysis of these is presented on the following page.
31 December 2025
Neither past
due nor
impaired
$'000
Past due but
not impaired
$'000
Gross value of
impaired
assets
$'000
Impairment
allowance
$'000
Total
$'000
Investments
Shares and other variable yield
securities and units in unit trusts
Debt securities and other fixed
income securities
Participation in investment pools
Syndicate loans to central fund
Other investments
Deposits with ceding
undertakings
Total Investments
861,416 — — — 861,416
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
31 December 2024
Neither past
due nor
impaired
$'000
Past due but
not impaired
$'000
Gross value of
impaired
assets
$'000
Impairment
allowance
$'000
Total
$'000
Investments
Shares and other variable yield
securities and units in unit trusts
Debt securities and other fixed
income securities
Participation in investment pools
Syndicate loans to central fund
Other investments
Deposits with ceding undertakings
Total Investments
694,496 — — — 694,496
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
SYNDICATE 3623
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
YEAR ENDED 31 DECEMBER 2025
35
2 Risk management continued
The table below sets out the reconciliation of changes in impairment allowance during the period for each
class of financial asset at the balance sheet date:
Impairment allowance
1 Jan
New
impairment
charges
added in
the year
Changes in
impairment
charges
Released
to profit
and loss
account
Foreign
exchange
and other
movements Others Total
31 December 2025
$'000 $'000 $'000 $'000 $'000 $'000 $'000
Debtors arising out of direct insurance
operations
Debtors arising out of reinsurance
operations
Total — 1,156 — — — —
Impairment allowance
1 Jan
New
impairment
charges
added in
the year
Changes in
impairment
charges
Released
to profit
and loss
account
Foreign
exchange
and other
movements Others Total
31 December 2024
$'000 $'000 $'000 $'000 $'000 $'000 $'000
Debtors arising out of direct insurance
operations
Debtors arising out of reinsurance
operations
Total — — — — — — —
The table below sets out the age analysis of financial assets that are past due but not impaired at the
balance sheet date:
Past due but not impaired assets
Up to 3
months
past due
3 – 6
months
past due
6 – 12
months
past due
Greater
than 1
year past
due
Total
31 December 2025
$'000 $'000 $'000 $'000 $'000
Debtors arising out of direct insurance operations 66,953 8,774 — — 75,727
Debtors arising out of reinsurance operations — 23 81 3,058 3,162
Total 66,953 8,797 81 3,058 78,889
Past due but not impaired assets
Up to 3
months
past due
3 – 6
months
past due
6 – 12
months
past due
Greater
than 1
year past
due
Total
31 December 2024
$'000 $'000 $'000 $'000 $'000
Debtors arising out of direct insurance operations 47,064 2,063 1,233 1,157 51,517
Debtors arising out of reinsurance operations — 15 — 3,033 3,048
Total 47,064 2,078 1,233 4,190 54,565
Based on all evidence available, other debtors have not been impaired and no impairment provision has
been recognised in respect of these assets (2024: nil). No other financial assets held at year end were
impaired.
SYNDICATE 3623
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
YEAR ENDED 31 DECEMBER 2025
36
2 Risk management continued
2.4 Liquidity risk
Liquidity risk arises where cash may not be available to pay obligations when due at a reasonable cost. The
syndicate is exposed to daily calls on its available cash resources, principally from claims arising from its
insurance business. In the majority of the cases, these claims are settled from the premiums received.
The managing agent’s approach is to manage the syndicate's liquidity position so that it can reasonably
survive a significant individual or market loss event. This means that the syndicate maintains sufficient
liquid assets, or assets that can be translated into liquid assets at short notice and without any significant
capital loss, to meet expected cash flow requirements. These liquid funds are regularly monitored using
cash flow forecasting to ensure that surplus funds are invested to achieve a higher rate of return.
The maturity analysis presented in the table below shows the remaining contractual maturities for the
syndicate’s insurance contracts and financial instrument liabilities. For insurance and reinsurance contracts,
the contractual maturity is the estimated date when the gross undiscounted contractually required cash
flows will occur. For financial liabilities, it is the earliest date on which the gross undiscounted cash flows
(including contractual interest payments) could be paid assuming conditions are consistent with those at
the reporting date.
Undiscounted net cash flows
No
maturity
stated
0 - 1 yrs 1 - 3 yrs 3 - 5 yrs >5 yrs Total
31 December 2025
$'000 $'000 $'000 $'000 $'000 $'000
Claims outstanding
Creditors
Other liabilities
Total 109,411 342,973 338,945 175,819 157,232 1,124,380
Undiscounted net cash flows
No
maturity
stated
0 - 1 yrs 1 - 3 yrs 3 - 5 yrs >5 yrs Total
31 December 2024 $'000 $'000 $'000 $'000 $'000 $'000
Claims outstanding
Creditors
Other liabilities
Total 119,885 464,981 277,504 132,931 107,939 1,103,240
SYNDICATE 3623
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
YEAR ENDED 31 DECEMBER 2025
37
2.5 Capital management
Capital framework at Lloyd’s
The Society of Lloyd’s is a regulated undertaking and subject to the supervision of the Prudential
Regulation Authority under the Financial Services and Markets Act 2000.
Within this supervisory framework, Lloyd’s applies capital requirements at member level and centrally to
ensure that Lloyd’s complies with Solvency II, and beyond that to meet its own financial strength, license
and ratings objectives. Although, as described below, the Lloyd’s capital setting processes use a capital
requirement set at syndicate level as a starting point, the requirement to meet Solvency II and Lloyd’s
capital requirements apply at an overall and member level respectively, not at a syndicate level.
Accordingly the capital requirement in respect of Syndicate 3623 is not disclosed in these financial
statements.
Lloyd’s capital setting process
In order to meet Lloyd’s requirements, each syndicate is required to calculate its Solvency Capital
Requirement (SCR) for the prospective underwriting year. This amount must be sufficient to cover a 1 in
200 year loss, reflecting uncertainty in the ultimate run-off of underwriting liabilities (SCR ‘to ultimate’).
The syndicate must also calculate its SCR at the same confidence level but reflecting uncertainty over a
one year time horizon (one year SCR) for Lloyd’s to use in meeting Solvency II requirements. The SCRs of
each syndicate are subject to review by Lloyd’s and approval by the Lloyd’s Capital and Planning Group.
A syndicate comprises 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 1 in 200 year loss ‘to ultimate’ for that member. Over and above this, Lloyd’s applies a capital
uplift to the member’s capital requirement, known as the Economic Capital Assessment (‘ECA’). The
purpose of this uplift (which is a Lloyd’s requirement, not a Solvency II requirement) is to meet Lloyd’s
financial strength, license and ratings objectives. The capital uplift applied for 2025 was 35% (2024: 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) and/or as
the member’s share of the Solvency II members’ balances on each syndicate on which it participates.
SYNDICATE 3623
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
YEAR ENDED 31 DECEMBER 2025
38
3 Analysis of underwriting result
Underwriting result is the balance on the technical result - general business, less the allocated investment
return transferred from the non-technical account.
Gross
premiums
written
Gross
premiums
earned
Gross
claims
incurred
Gross
operating
expenses
Reinsurance
balance
Underwriting
result
2025 $'000 $'000 $'000 $'000 $'000 $'000
Direct Insurance
Accident and Health 11,836 32,605 (23,389 ) (12,728 ) (742 ) (4,254 )
Marine, aviation and
transport
(1,605 ) (1,450 ) (3,606 ) (190 ) 2,889 (2,357 )
Fire and other damage
to property
Third party liability 237,971 615,223 (348,703 ) (201,776 ) (49,724 ) 15,020
Credit and suretyship 15,984 19,943 (8,062 ) (17,508 ) (1,324 ) (6,951 )
Total direct insurance
Reinsurance
acceptances
Total direct
insurance and
reinsurance accepted
Gross
premiums
written
Gross
premiums
earned
Gross
claims
incurred
Gross
operating
expenses
Reinsurance
balance
Underwriting
result
2024* $'000 $'000 $'000 $'000 $'000 $'000
Direct Insurance
Marine, aviation and
transport (558 ) 614 (1,808 ) (402 ) 1,403 (193 )
Fire and other damage
to property
Third party liability 1,006,060 483,898 (264,371 ) (168,854 ) (26,922 ) 23,752
Credit and suretyship 27,707 12,819 (5,245 ) (10,322 ) (1,679 ) (4,427 )
Total direct insurance
Reinsurance
acceptances 67,406 34,536 (7,970 ) (14,508 ) (8,426 ) 3,632
Total direct
insurance and
reinsurance accepted 1,335,977 681,023 (330,085 ) (235,509 ) (64,088 ) 51,342
*Certain balances which were previously classified within gross operating expenses have now been classified within
reinsurance balance. The prior period comparative has been restated accordingly.
The gross premiums written for direct insurance by location (where the contracts were concluded) is
presented in the table below:
Concentration of insurance risk
2025
$'000
2024
$'000
United Kingdom
Total gross premiums written
SYNDICATE 3623
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
YEAR ENDED 31 DECEMBER 2025
39
4 Net operating expenses | ||
| 2025 | 2024 | |
| $'000 | $'000 | |
Acquisition costs | | |
Change in deferred acquisition costs | | ( |
Administrative expenses | | |
Reinsurance commissions and profit participation | ( | ( |
| Net operating expenses | | |
Total commissions for direct insurance business for the year amounted to:
| 2025 | 2024 | |
| $'000 | $'000 | |
Total commission for direct insurance business | | |
Administrative expenses include:
| 2025 | 2024 | |
| $’000 | $’000 | |
Fees payable to the syndicate’s auditor for the audit of these syndicate annual accounts | | |
Fees payable to the syndicate's auditor and its associates in respect of other services pursuant to legislation to align with Lloyds | | |
Total | 389 | 351 |
Fees payable to the syndicate's auditor in relation to other services pursuant to legislation primarily relate
to the review and audit of syndicate regulatory returns along with the statement of actuarial opinion.
5 Key management personnel compensation
The Directors of BFL received the following aggregate remuneration charged to 3623 and included within
net operating expenses:
2025 | 2024 | |
| $’000 | $’000 | |
Directors' emoluments | | |
The active underwriter received the following aggregate remuneration charged to 3623:
| 2025 | 2024 | |
| $’000 | $’000 | |
Emoluments | | |
6 Staff numbers and costs
The syndicate has no employees. All staff are employed by Beazley Management Limited ('BML'), a related
company to the managing agent, both of which operate within the Beazley Group. The average number of
persons employed by BML but working for the syndicate during the year, analysed by category, was as
follows:
SYNDICATE 3623
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
YEAR ENDED 31 DECEMBER 2025
40
6 Staff numbers and costs continued
Number of employees | ||
| 2025 | 2024 | |
| Administration and finance | | |
| Underwriting | | |
| Claims | | |
| Investments | | |
| Total | | |
The following amounts were recharged to the syndicate in respect of payroll costs:
| 2025 | 2024 | |
| $’000 | $’000 | |
| Wages and salaries | | |
| Social security | | |
| Other pension costs | | |
| Other | | |
| Total | | |
7 Investment return
| 2025 | 2024 | |
| $’000 | $’000 | |
Interest and similar income | ||
From financial assets designated at fair value through profit or loss | ||
Interest and similar income | | |
From financial assets classified at amortised cost | ||
Interest on cash at bank | | |
Other income from investments | ||
From financial assets designated at fair value through profit or loss | ||
Gains on the realisation of investments | | |
Losses on the realisation of investments | ( | ( |
Unrealised gains on investments | | |
Unrealised losses on the investments | ( | ( |
Financial liabilities at amortised cost | ||
Interest expense | | |
Investment management expenses* | ( | ( |
Total investment return | | |
| Transferred to the technical account from the non technical account | | |
* Included in Investment management expenses is investment return of $nil (2024: $4,787k) payable to
Syndicate 5623 in relation to withheld cash balances due to Syndicate 5623, along with a balance of $nil
(2024: $186k) payable to Syndicate 6107.
8 Distribution and open years of account
The syndicate did not underwrite on the 2023 Year of Account, and thus no distribution is proposed as no
underwriting year has reached the point of closure (2024: distribution of $51,664 k for year of account
2022).
SYNDICATE 3623
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
YEAR ENDED 31 DECEMBER 2025
41
9 Financial investments
Carrying value Cost
2025 2024 2025 2024
$’000 $’000 $’000 $’000
Shares and other variable yield securities
and units in unit trusts
Debt securities and other fixed income
securities
Participation in investment pools 16,274 25,641 16,286 25,409
Syndicate loans to central fund — 2,470 — 2,425
Other investments 35,471 35,315 35,471 35,128
Total financial investments 861,393 694,443 849,786 689,265
Included in the carrying values above are listed investments as follows:
| 2025 | 2024 | |
| $’000 | $’000 | |
| Listed investments | | |
The table below presents an analysis of financial investments by their measurement classification:
| 2025 | 2024 | |
| $’000 | $’000 | |
| Financial assets measured at fair value through profit or loss | | |
| Total financial investments | | |
Valuation hierarchy
All assets and liabilities for which fair value is measured or disclosed in the financial statements are
categorised within the fair value hierarchy described as follows, based on the lowest level input that is
significant to the fair value measurement as a whole. If the inputs used to measure the fair value of an
asset or a liability could be categorised in different levels of the fair value hierarchy, then the fair value
measurement is categorised in its entirety in the same level of the fair value hierarchy as the lowest level
input that is significant to the entire measurement.
Level 1 – Valuations based on quoted prices in active markets for identical instruments. An active market
is a market in which transactions for the instrument occur with sufficient frequency and volume on an
ongoing basis such that quoted prices reflect prices at which an orderly transaction would take place
between market participants at the measurement date.
Level 2 – Valuations based on quoted prices in markets that are not active, or based on pricing models for
which significant inputs can be corroborated by observable market data, directly or indirectly (e.g. interest
rates, exchange rates). Level 2 inputs include:
• Quoted prices similar assets and liabilities in active markets;
• Quoted prices for identical or similar assets and liabilities in markets that are not active, the prices are
not current, or price quotations vary substantially either over time or among market makers, or in
which little information is released publicly;
• Inputs other than quoted prices that are observable for the asset or liability (for example, interest rates
and yield curves observable at commonly quoted intervals, implied volatilities and credit spreads); and
• Market corroborated inputs. Included within level 2 are government bonds and treasury bills, equity
funds and corporate bonds which are not actively traded, hedge funds and senior secured loans.
Level 3 – Valuations based on inputs that are unobservable or for which there is limited market activity
against which to measure fair value. The availability of financial data can vary for different financial assets
and is affected by a wide variety of factors, including the type of financial instrument, whether it is new
and not yet established in the marketplace, and other characteristics specific to each transaction. To the
extent that valuation is based on models or inputs that are unobservable in the market, the determination
of fair value requires more judgement. Accordingly the degree of judgement exercised by management in
SYNDICATE 3623
NOTES TO THE FINANCIAL STATEMENTS
YEAR ENDED 31 DECEMBER 2025
42
42
9 Financial investments continued
determining fair value is greatest for instruments classified in level 3. The managing agent uses prices and
inputs that are current as of the measurement date for valuation of these instruments.
Valuation approach
The valuation approach for fair value assets and liabilities classified as Level 2 is as follows:
• For the Syndicate’s level 2 collateralised loan obligations included within 'Debt securities and other fixed
income investments', our fund administrator provides daily pricing derived from a market-accepted
theoretical model using data sourced from Bloomberg/Reuters as inputs. On a monthly basis, prices
from our administrator are validated against those provided by our custodians. These are also checked
internally for consistency.
The table below analyses financial instruments measured at fair value at 31 December 2025, based on the
level in the fair value hierarchy into which the financial instrument is categorised.
2025 Level 1 Level 2 Level 3
Assets
held at
amortised
cost
Total
$’000 $’000 $’000
$’000
$’000
Shares and other variable yield
securities and units in unit
trusts
Debt securities and other fixed
income securities
Participation in investment pools 16,274 — — — 16,274
Syndicate loans to central fund — — — — —
Other investments 35,471 — — — 35,471
Total financial investments 576,771 284,622 — — 861,393
Derivative financial liabilities — — — — —
Total 576,771 284,622 — — 861,393
| 2024 | Level 1 | Level 2 | Level 3 | Assets held at amortised cost | Total |
| $’000 | $’000 | $’000 | $’000 | $’000 | |
Shares and other variable yield securities and units in unit trusts | | | | | |
Debt securities and other fixed income securities | | | | | |
Participation in investment pools | | | | | |
Syndicate loans to central fund | | | | | |
Other investments | | | | | |
| Total financial investments | | | | | |
| Derivative financial liabilities | | | | | |
Total | | | | | |
SYNDICATE 3623
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
YEAR ENDED 31 DECEMBER 2025
43
10 Debtors arising out of direct insurance operations
| 2025 | 2024 | |
| $'000 | $'000 | |
| Due within one year | | |
| Due after one year | | |
Total | | |
11 Debtors arising out of reinsurance operations
| 2025 | 2024 | |
| $'000 | $'000 | |
| Due within one year | | |
| Due after one year | | |
Total | | |
12 Other debtors
| 2025 | 2024 | |
| $'000 | $'000 | |
Inter-syndicate balances | ||
Amounts due from Syndicate 623 | 4,933 | 4,384 |
Amounts due from Syndicate 2623 | — | 48,757 |
Total inter-syndicate balances | | |
| Other | | |
Total | | |
The balances listed above are due within one year.
13 Deferred acquisition costs
| 2025 | 2024 | |||||
| Gross | Reinsurance | Net | Gross | Reinsurance | Net | |
| $'000 | $'000 | $'000 | $'000 | $'000 | $'000 | |
| Balance at 1 January | | ( | | | ( | |
Incurred deferred acquisition costs | | ( | | | ( | |
Amortised deferred acquisition costs | ( | | ( | ( | | ( |
| Foreign exchange movements | | | | ( | | ( |
| Balance at 31 December | | ( | | ( | |
SYNDICATE 3623
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
YEAR ENDED 31 DECEMBER 2025
44
14 Technical provisions
The table below shows the changes in the insurance contract liabilities and assets from the beginning of
the period to the end of the period.
2025 2024
Gross
provisions
Reinsurance
assets
Net
Gross
provisions
Reinsurance
assets
Net
Claims outstanding
$'000 $'000 $'000 $'000 $'000 $'000
Balance at 1 January
Claims paid during the
year
(245,295 ) 85,273 (160,022 ) (105,879 ) 55,705 (50,174 )
Expected cost of current
year claims
Change in estimates of
prior year provisions
(8,731 ) 22,988 14,257 (55,001 ) 30,029 (24,972 )
Foreign exchange
movements
Balance at 31
December
2025 2024
Gross
provisions
Reinsurance
assets
Net
Gross
provisions
Reinsurance
assets
Net
Unearned
premiums
$'000 $'000 $'000 $'000 $'000 $'000
Balance at 1 January
Premium written during
the year
Premiums earned during
the year
(878,378 ) 123,602 (754,776 ) (681,023 ) 108,899 (572,124 )
Foreign exchange
movements
Balance at 31
December
Refer to note 2 for the sensitivity analysis performed over the value of insurance liabilities, disclosed in the
accounts, to potential movements in the assumptions applied within the technical provisions.
SYNDICATE 3623
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
YEAR ENDED 31 DECEMBER 2025
45
14 Technical provisions continued
The following tables illustrate the development of the estimates of earned ultimate cumulative claims
incurred, including claims notified and IBNR, for each successive underwriting year, illustrating how
amounts estimated have changed from the first estimates made. The below tables were previously shown
on a fully earned basis. This is the first year presenting these tables on a earned basis. As these tables are
on an underwriting year basis, there is an apparent large increase from amounts reported for the end of
the underwriting year to one year later as a large proportion of premiums are earned in the year of
account’s second year of development.
Gross: | |||||||||||
| 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 | Total | |
Pure underwriting year | $ '000 | $ '000 | $ '000 | $ '000 | $ '000 | $ '000 | $ '000 | $ '000 | $ '000 | $ '000 | $ '000 |
Estimate of gross claims | |||||||||||
at end of underwriting year | | | | | | | | ||||
one year later | | | | ||||||||
two years later | | | | | |||||||
three years later | | | | ||||||||
four years later | | | |||||||||
five years later | | | |||||||||
six years later | | | |||||||||
seven years later | | ||||||||||
eight years later | |||||||||||
nine years later | |||||||||||
Estimate of gross claims reserve | | | | | | ||||||
Provision in respect of prior years | |||||||||||
Less gross claims paid | ( | ( | ( | ( | ( | ( | ( | | ( | ( | ( |
Gross claims reserves | | | | | | | | | | | |
Net:
2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 Total
Pure underwriting
year
$ '000 $ '000 $ '000 $ '000 $ '000 $ '000 $ '000 $ '000 $ '000 $ '000 $ '000
Estimate of net claims
at end of underwriting
year
one year later
two years later
three years later
four years later
five years later
six years later
seven years later
eight years later
nine years later
Estimate of net
claims reserve
Provision in respect of
prior years
Less net claims paid
(145,754 ) (65,953 ) (28,338 ) (36,599 ) (41,494 ) (26,589 ) (32,327 ) — (158,405 ) (11,023 ) (546,482 )
Net claims reserves
15 Creditors arising out of direct insurance operations
| 2025 | 2024 | |
| $'000 | $'000 | |
| Due within one year | | |
| Due after one year | | |
Total | | |
SYNDICATE 3623
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
YEAR ENDED 31 DECEMBER 2025
46
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 due to Syndicate 5623 — 100,189
Amounts due to Syndicate 2623 93,303 —
Amounts due to Syndicate 6107 16,108 19,695
Total inter-syndicate balances
Other related party balances (non-syndicates) 73,753 113,382
Other liabilities 8 1,916
Total 183,172 235,182
The above other creditors balances are payable within one year except for inter-syndicate balances with
6107 which will settle upon the closure of the associated YoA. These are payable after more than one year.
18 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 | | |
*Included within Cash at bank and in hand are money market funds of $43k (2024: nil).
Short term deposits disclosed in this table are included within financial investments. Included within cash
and cash equivalents are the following amounts which are not available for use by the syndicate as they
are held for regulatory purposes.
| 2025 | 2024 | |
| $'000 | $'000 | |
Short term debt instruments presented within other financial investments | | |
Total cash and cash equivalents not available for use by the syndicate | | |
SYNDICATE 3623
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
YEAR ENDED 31 DECEMBER 2025
47
19 Analysis of net debt
All amounts in $'000
At 1 January
2025 Cash flows Acquired
Fair value and
exchange
movements
Non-cash
changes
At 31 December
2025
Cash and cash
equivalents
Total
All amounts in $'000
At 1 January
2024 Cash flows Acquired
Fair value and
exchange
movements
Non-cash
changes
At 31 December
2024
Cash and cash
equivalents
Total
20 Related party transactions
BFL as the managing agent of the syndicate is responsible for settling intercompany balances with other
managed syndicates and net amounts due to/from other related entities. In relation to the 2022 YoA and
prior years, the syndicate ceded a portion of its market facilities business to Syndicate 5623 on a quota
share basis. In the 2024 and 2025 YoA only, the syndicate ceded portions of certain cyber policies to
Syndicate 6107 on a quota share basis. Amounts due to these syndicates are set out in note 17.
21 Subsequent events
There have been no balance sheet events which have occurred between the reporting date and the date
which the financial statements have been signed, for which an adjustment and or disclosure is required.
22 Foreign exchange rates
The syndicate used the following exchange rates to translate foreign currency assets, liabilities, income
and expenses into US dollars, being the syndicate’s presentational currency:
| 2025 | 2024 | |||||
| Start of period | End of period | Average | Start of period | End of period | Average | |
| Sterling | | | | | | |
| Euro | | | | | | |
| US dollar | | | | | | |
Canadian dollar | | | | | | |
Australian dollar | | | | | | |
23 Funds at Lloyd's
Every member is required to hold capital at Lloyd’s which is held in trust and known as Funds at Lloyd’s
(‘FAL’). These funds are intended primarily to cover circumstances where syndicate assets prove
insufficient to meet participating members’ underwriting liabilities. The level of FAL that Lloyd’s requires a
member to maintain is determined by Lloyd’s based on Prudential Regulatory Authority requirements and
resource criteria. The determination of FAL has regard to a number of factors including the nature and
amount of risk to be underwritten by the member and the assessment of the reserving risk in respect of
business that has been underwritten. Since FAL is not under the management of the managing agent, no
amount has been shown in these Financial Statements by way of such capital resources. However, the
managing agent is able to make a call on the Member’s FAL to meet liquidity requirements or to settle
losses.
SYNDICATE 3623
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
YEAR ENDED 31 DECEMBER 2025
48
Beazley Furlonge Limited has been the managing agent of Syndicate 3623 throughout the period covered
by this report and the registered office is 22 Bishopsgate, London EC2N 4BQ.
Directors
R A Stuchbery* - Chair
R S Anarfi - (resigned 28/02/2025)
P J Bantick - (resigned 17/03/2025)
W W E Barkholt* - (appointed 01/01/2025)
R J Clark*
A P Cox - (resigned 18/03/2025)
M E Diacon - (appointed 10/03/2025)
B J Greenwood - (appointed 18/03/2025)
G A Hayes - (appointed 13/03/2025)
A J Reizenstein* - (resigned 30/04/2025)
L Santori*
K J Somasundaram* - (appointed 03/11/2025)
N Wall*
C C J Wong
* Non-Executive Director.
Active underwriter
G A Hayes
Company secretary
R Yeoman
Managing agent’s registered office
22 Bishopsgate
London
EC2N 4BQ
United Kingdom
Registered number
01893407
Syndicate number
3623
Auditor
Ernst & Young LLP
25 Churchill Place
London
E14 5EY
Banker
Deutsche Bank AG
Winchester House
London
1 Great Winchester Street
EC2N 2DB
SYNDICATE 3623
MANAGING AGENT'S CORPORATE INFORMATION
YEAR ENDED 31 DECEMBER 2025
49
49
