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Lloyd’s Syndicate 2019
Annual Report and Accounts for the year ended
Talbot Underwriting Ltd | Lloyd’s Syndicate 2019
Annual Report and Accounts for the year ended 31 December 2025
3
Contents
Syndicate 2019 – Annual accounts for the year ended 31 December 2025
Directors and Administration – Syndicate 2019 4
Report of the Directors of the Managing Agent 5
Statement of Managing Agent’s Responsibilities 11
Independent auditors’ report to the member of Syndicate 2019 12
Statement of profit or loss and other comprehensive income: 16
Balance sheet – Assets 18
Balance sheet – Liabilities 19
Statement of changes in member’s balances 20
Statement of cash flows 21
Notes to the financial statements 22
Talbot Underwriting Ltd | Lloyd’s Syndicate 2019
Annual Report and Accounts for the year ended 31 December 2025
4
Directors and Administration – Syndicate 2019
Managing Agent Managing Agent’s registered number
Talbot Underwriting Ltd
58 Fenchurch Street
London
EC3M 4AB
2202362
Directors
EL Woolley
JG Ross
RE Bean
RD Cowling
ME Hind
DJ Batchelor
P Bergamaschi
KA Coates
CJ Flatt
JL Hancock
Chief Executive Officer
Chief Risk Officer
Chief Underwriting Officer
Chief Financial Officer
Independent Non-executive
Independent Non-executive
Independent Non-executive
Independent Non-executive
Non-executive
Non-executive
Company secretary Active underwriter
K Guérin AR Fox
Bankers Investment managers
Citibank NA
Barclays plc
BlackRock Investment Management (UK) Limited
12 Throgmorton Avenue
London
EC2N 2DL
Lloyd’s Treasury Services
One Lime Street
London
EC3M 7HA
Independent auditors
PricewaterhouseCoopers LLP
7 More London
Riverside
London
SE1 2RT
Talbot Underwriting Ltd | Lloyd’s Syndicate 2019
Annual Report and Accounts for the year ended 31 December 2025
5
Report of the Directors of the Managing Agent
The Directors of the Managing Agent, Talbot Underwriting Ltd (TUL), present the annual report and
audited accounts of Syndicate 2019 (the Syndicate) for the year ended 31 December 2025. The annual
report is prepared using the annual basis of accounting as required by Regulation 5 of the Insurance
Accounts Directive (Lloyd’s Syndicate and Aggregate Accounts) Regulations 2008.
The comments below refer to both information prepared on an annual accounting basis and information
derived from a Lloyd’s underwriting year of account basis. The latter is included where it is used to
manage the business.
Principal activities
Prior to 2025, the principal activity of the Syndicate was the underwriting of proportional quota share
reinsurance covering High Net Worth (HNW) personal lines insurance business in the US, underwritten
by American International Group, Inc (AIG). The quota share reinsurance provided coverage for AIG
HNW policies, incepting from 1 January each year. In December 2024, AIG non-renewed the PCS
Whole Account Quota Share for the 2025 underwriting year of account. As such, the 2024 and prior
underwriting years are now effectively running off.
For the 2025 underwriting year of account, the Syndicate has underwritten a quota share for the PCS
Collections portfolio on a standalone basis with a 30% participation. The Collections quota share for
PCS incepted on 1 January 2025 and is ceded on a gross basis. Outwards reinsurance cover is
purchased directly by the Syndicate. This contrasts to the 2024 and prior years of account, where the
whole account quota share agreements were ceded net of the deemed inuring reinsurance cover
purchased by AIG. The deemed inuring reinsurance purchased by AIG in 2025 will continue to apply to
the run-off of the 2024 and prior underwriting years.
The Syndicate is managed by TUL, which is an AIG Company.
The Syndicate capacity for the 2026 underwriting year of account has increased to £24.1m (2025:
£21.0m; 2024: £498.2m). PCG 2019 Corporate Member Limited is the sole Corporate Member for
Syndicate 2019.
Results for the financial year
The result for the year was a profit of $35.4m (2024: profit of $131.8m). The Syndicate’s key financial
performance indicators during the year were as follows:
2025
$m
2024
$m
2023
$m
2022
$m
2021
$m
Gross premiums written 62.3
572.9
748.5
602.4
773.4
Net premiums written 60.8
572.9
748.5
602.4
773.4
Net earned premiums 322.7
643.3
719.0
677.1
728.0
Underwriting result (9.5)
99.5
24.8
(50.2)
(99.1)
Investment return 44.3
32.4
34.2
(13.8)
(2.0)
Profit/(loss) for the financial year 35.4
131.8
59.3
(64.0)
(101.3)
Net claims ratio (%)
1
72.9
54.6
65.3
73.7
77.7
Net expense ratio (%)
2
30.0
29.9
31.3
33.7
35.9
Combined ratio (%)
3
102.9
84.5
96.6
107.4
113.6
1
The ratio of net claims incurred to net earned premiums.
2
The ratio of net operating expenses (both net acquisition costs and administrative expenses) to net earned premiums.
3
The total of net claims incurred and net operating expenses as a percentage of net earned premiums
Report of the Directors of the Managing Agent (continued)
Talbot Underwriting Ltd | Lloyd’s Syndicate 2019
Annual Report and Accounts for the year ended 31 December 2025
6
Review of the business
Underwriting
The Syndicate took a 30.0% share of PCG’s Collections portfolio for the 2025 underwriting year of
account. The Syndicate purchased $1.5m of excess of loss reinsurance (2024: nil). For the 2024 and
prior underwriting years, the Syndicate underwrote a proportional quota share reinsurance covering
HNW personal lines insurance business, with the portfolio protected by a reinsurance programme
purchased by AIG, comprising excess of loss, quota share and facultative covers, which is applied
before premium is ceded to the Syndicate.
In 2025, the Syndicate delivered a combined ratio of 102.9% (2024: 84.5%). The 2025 result was
unfavourably impacted by higher natural catastrophe claims driven by the California Wildfires at the start
of the year, and was partly offset by favourable current year attritional claims experience.
Gross Premiums Written
Gross premiums written by class of business for the calendar year were as follows:
2025
$m
2024
$m
Homeowners 10.2 372.8
Auto 1.2 103.0
Collections Fine Art 15.0 8.8
Collection General Specie 34.5 36.9
Yacht 0.4 4.7
Excess Liability 0.8 45.2
Workers Comp 0.2 1.5
Total Gross premiums written 62.3 572.9
Gross premiums written decreased by $510.6m in 2025 to $62.3m (2024: $572.9m) due to the non-
renewal of the AIG HNW Quota Share business.
Net claims
The net claims ratio for the year was 72.9% (2024: 54.6%). Net claims incurred as a percentage of net
earned premiums were as follows:
2025 2024
Current year claims ratio – attritional (%) 47.0 52.1
Current year claims ratio – catastrophe (%) 41.0 10.2
Change in prior years’ net claims ratio (%) (15.1) (7.7)
Net claims ratio (%) 72.9 54.6
Talbot Underwriting Ltd | Lloyd’s Syndicate 2019
Annual Report and Accounts for the year ended 31 December 2025
7
The current year attritional loss ratio of 47.0% (2024: 52.1%) reflects favourable experience on the 2024
and 2025 underwriting years of account.
Catastrophe losses in the year contributed 41.0% to the net claims ratio (2024: 10.2%). There have
been notable losses, including the California wildfires, impacting the 2024 underwriting year of account
in particular. During 2025, reserves on older years have remained stable overall and the net prior year
favourable development recognised was $48.6m, or 15.1% of net earned premium (2024: $49.3m, or
7.7% of net earned premium). Refer to note 6 for further details.
Net operating expenses
Net operating expenses for the year are set out below:
2025
$m
2024
$m
Movement
$m
Net acquisition costs 94.1 180.1 (86.0)
Administrative expenses 2.7 12.3 (9.6)
Net operating expenses 96.8 192.4 (95.6)
As % of net earned premiums % % %
Net acquisition expense ratio (%) 29.2 28.0 1.2
Administrative expense ratio (%) 0.8 1.9 (1.1)
Net expense ratio (%)
30.0 29.9 0.1
Net acquisition costs comprise the ceding commission as specified in the respective underwriting year
of account quota share contracts. The net acquisition ratio of 29.2% (2024: 28.0%) is a blend of costs
associated with premium earned across each underwriting year of account in the period. The quota
share acquisition ratio for the 2025 underwriting year of account is 42.5%, compared to 28.0% for the
2024 underwriting year of account, albeit on a reducing book of business. Administrative expenses
comprise of Lloyd’s costs and managing agency fees.
Report of the Directors of the Managing Agent (continued)
Talbot Underwriting Ltd | Lloyd’s Syndicate 2019
Annual Report and Accounts for the year ended 31 December 2025
8
Investment return
The return on Syndicate funds is shown below:
2025
$m
2024
$m
Average Syndicate funds available for investment 780.7 778.3
Investment return for the year 44.3 32.4
Calendar year investment return (%)
5.7
%
4.2%
Net investment return for 2025 was a profit of $44.3m (2024: profit of $32.4m) equating to a return of
5.7% (2024: return of 4.2%). Investment return includes net realised and unrealised gains of $13.9m
(2024: $1.7m) and income from investments net of expenses of $30.4m (2024: $30.6m). The investment
portfolio largely comprises investment grade fixed income securities with an average rating of AA-. The
Syndicate has reduced its asset duration to help settle claims and expenses for the run-off portfolio.
Refer to note 9 for further details of investment income, expenses and charges.
Financial position
The Syndicate’s members’ balance was $158.2m at 31 December 2025 (2024: $61.2m). The main
components of the balance sheet are financial investments and technical provisions.
Financial investments consist primarily of debt securities, issued by governments, government
agencies, or high-grade corporate entities and comprise 98.1% of the investment portfolio (2024:
94.1%). All investments are traded within liquid markets. The fair value of investments is determined
predominantly by TUL’s investment managers, using data from a number of sources including index
providers, commercial valuation providers and broker-dealers. At 31 December 2025, the fair value of
investments was $651.5m (2024: $762.3m) and the portfolio composition, as well as further details on
valuation methodology, is shown in note 11.
Technical provisions include a provision for claims outstanding of $476.0m (2024: $608.9m) and a
provision for unearned premiums of $22.7m (2024: $284.5m). Refer to note 2 for further details on the
reserving methodologies used for claims provisions and the judgements and uncertainties involved.
Capital
An internal capital model is used to set the Syndicate’s capital. The Syndicate is managed by TUL and
complies with Lloyd’s capital setting processes, which are described in more detail in note 4H.
Lloyd’s unique capital structure is designed to provide financial security to policyholders and capital
efficiency for members. Lloyd’s is A+ rated by A.M. Best, AA- by Fitch Ratings, AA- by Kroll Bond Rating
Agency and AA- by Standard & Poor’s. This chain of security provides the financial strength that
ultimately backs the insurance written through Lloyd’s managed syndicates.
Talbot Underwriting Ltd | Lloyd’s Syndicate 2019
Annual Report and Accounts for the year ended 31 December 2025
9
Key components of the Lloyd’s capital structure are as follows:
All premiums received by Syndicates are held in trust
Every member is required to hold capital at Lloyd’s known as Funds at Lloyd’s (FAL); and
Central assets are available at the discretion of the Council of Lloyd’s to meet any valid claim
that cannot be met from the resources of any member.
The Syndicate is now wholly aligned to PCG 2019 Corporate Member Limited, which is part of the AIG
Group. This covers the 2023 and onwards underwriting years of account. The capital and solvency
position of the Syndicate remains robust following its performance in 2025 and continued support from
AIG, as evidenced by its commitment of capital support for the 2026 Syndicate Business Plan which
has been approved by the Council of Lloyd’s. The Syndicate’s 2026 underwriting plan is fully capitalised
with FAL that is entirely provided by AIG, which is A+ rated by A.M. Best and AA- by Fitch Ratings and
Standard & Poor’s. The Syndicate has available resources, including those through its wholly aligned
member’s reinsurance, to mitigate all modelled stress scenarios.
Future developments and outlook
The Syndicate capacity for the 2026 underwriting year of account has increased to £24.1m (2025
underwriting year of account: £21.0m).
TUL is currently finalising the transition to the AIG IT infrastructure and moving systems away from the
legacy infrastructure. This will be finalised in 2026. Further detail is included within the Operational Risk
disclosure in note 4E.
For the 2026 underwriting year of account, the Syndicate will continue to reinsure AIG’s PCS Collections
portfolio on a standalone basis with 30% participation. The Syndicate purchases direct outwards
reinsurance protection for this business. This book will complement the Fine Art and Specie book that
TUL underwrites through Syndicate 1183, and TUL will work with AIG on additional opportunities, which
would be accretive.
TUL continues to manage the orderly run-off of the liabilities for the 2024 and prior underwriting years
of account. In parallel, management will work with AIG to explore options, which may facilitate the
release of capital and reduction in costs in relation to the run-off.
Principal risks and uncertainties
The principal risks and uncertainties to the Syndicate are insurance, financial, operational and climate
change risks. A description of these principal risks and uncertainties, as well as details around TUL’s
wider risk management framework is set out in note 4 to the financial statements (risk management).
Report of the Directors of the Managing Agent (continued)
Talbot Underwriting Ltd | Lloyd’s Syndicate 2019
Annual Report and Accounts for the year ended 31 December 2025
10
Directors
The Directors of the Managing Agent during the period from 1 January 2025 to the date of this report
were as follows:
EL Woolley (Chief Executive Officer, appointed 26 May 2025)
JG Ross (Chief Risk Officer)
RE Bean (Chief Underwriting Officer)
RD Cowling (Chief Financial Officer)
ME Hind (Independent Non-executive)
DJ Batchelor
P Bergamaschi
(Independent Non-executive)
(Independent Non-executive, appointed 20 October 2025)
KA Coates (Independent Non-executive)
JL Hancock (Non-executive, shareholder representative)
CJ Flatt (Non-executive, shareholder representative, appointed 11 September 2025)
Former Directors who served during the period from 1 January 2025 to the date of this report were as
follows:
CJR Rash (Chief Executive Officer, resigned 26 May 2025)
Active Underwriter
AR Fox
Company Secretary
K Guérin
Statutory Information
Disclosure of information to auditors
The Directors of the Managing Agent who held office at the date of approval of this report confirm that,
so far as they are each aware, there is no relevant audit information of which the Syndicate’s auditors
are unaware; and each Director has taken all the steps that they ought to have taken as a Director to
make themselves aware of any relevant audit information and to establish that the Syndicate’s auditors
are aware of that information.
Independent auditors
The Syndicate auditors, PricewaterhouseCoopers LLP, have indicated their willingness to continue in
office and will be reappointed.
Annual General Meeting
Subject to the consent of the Council of Lloyd’s, it is not intended to hold a Syndicate Annual General
Meeting in 2026.
Talbot Underwriting Ltd | Lloyd’s Syndicate 2019
Annual Report and Accounts for the year ended 31 December 2025
11
Statement of Managing Agent’s Responsibilities
The Directors of the Managing Agent are required by the Insurance Accounts Directive (Lloyd’s
Syndicate and Aggregate Accounts) Regulations 2008 to prepare Syndicate annual accounts at 31
December each year, which give a true and fair view of the state of affairs of the Syndicate and of the
profit or loss of the Syndicate for that year. The Directors have elected to prepare the Syndicate annual
accounts in accordance with applicable law and United Kingdom Accounting Standards (United
Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 “The
Financial Reporting Standard Applicable in the UK and Republic of Ireland” (FRS 102), Financial
Reporting Standard 103 “Insurance Contracts” (FRS 103) 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 Directors must not approve the accounts unless they are satisfied that they give a true and fair view
of the state of affairs of the Syndicate and of the profit or loss of the Syndicate for that period. In preparing
these accounts, the Directors 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, including FRS 102 and FRS 103, have been
followed, subject to any material departures disclosed and explained in the Syndicate annual
accounts; and
prepare the Syndicate annual accounts on the basis that the Syndicate will continue to write
business unless it is inappropriate to presume that the Syndicate will do so.
The Directors of the Managing Agent confirm that they have complied with the above requirements in
preparing the Syndicate annual accounts.
The Directors of the Managing Agent are responsible for;
keeping proper accounting records that disclose with reasonable accuracy at any time the financial
position of the Syndicate and enable them to ensure that its accounts comply with the Insurance
Accounts Directive (Lloyd’s Syndicate and Aggregate Accounts) Regulations 2008;
safeguarding the assets of the Syndicate and hence for taking reasonable steps for the prevention
and detection of fraud and other irregularities; and
the preparation and review of the iXBRL tagging that has been applied to the Syndicate annual
accounts in accordance with the instructions issued by Lloyd’s, including designing, implementing
and maintaining systems, processes and internal controls to result in tagging that is free from
material non-compliance with the instructions issued by Lloyd’s, whether due to fraud or error.
We confirm that to the best of our knowledge the Syndicate annual 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.
Approved by the Board of Directors and signed on behalf of the Board.
RD Cowling, Chief Financial Officer
19 February 2026
Talbot Underwriting Ltd | Lloyd’s Syndicate 2019
Annual Report and Accounts for the year ended 31 December 2025
12
Independent auditors’ report to the member of
Syndicate 2019
Report on the audit of the syndicate annual accounts
Opinion
In our opinion, 2019’s syndicate annual accounts:
give a true and fair view of the state of the syndicate’s affairs as at 31 December 2025 and of
its profit and cash flows for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted
Accounting Practice (United Kingdom Accounting Standards, including FRS 102 “The Financial
Reporting Standard applicable in the UK and Republic of Ireland”, and applicable law); and
have been prepared in accordance with the requirements of The Insurance Accounts Directive
(Lloyd’s Syndicate and Aggregate Accounts) Regulations 2008 and the requirements within the
Lloyd’s Syndicate Accounts Instructions version 3.1 as modified by the Frequently Asked
Questions issued by Lloyd’s version 1.1 (“the Lloyd’s Syndicate Instructions”).
We have audited the syndicate annual accounts included within the Annual Report and Accounts (the
“Annual Report”), which comprise: the balance sheet as at 31 December 2025; the statement of profit
or loss and other comprehensive income, the statement of cash flows, and the statement of changes
in member’s balances for the year then ended; and the notes to the syndicate annual accounts, which
include a description of the significant accounting policies.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (“ISAs (UK)”), The
Insurance Accounts Directive (Lloyd’s Syndicate and Aggregate Accounts) Regulations 2008, the
Lloyd’s Syndicate Instructions and applicable law. Our responsibilities under ISAs (UK) are further
described in the Auditors’ responsibilities for the audit of the syndicate annual accounts section of our
report. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a
basis for our opinion.
Independence
We remained independent of the syndicate in accordance with the ethical requirements that are relevant
to our audit of the syndicate annual accounts in the UK, which includes the FRC’s Ethical Standard, as
applicable to other entities of public interest, and we have fulfilled our other ethical responsibilities in
accordance with these requirements.
To the best of our knowledge and belief, we declare that non-audit services prohibited by the FRC’s
Ethical Standard were not provided.
Other than those disclosed in note 7, we have provided no non-audit services to the syndicate in the
period under audit.
Talbot Underwriting Ltd | Lloyd’s Syndicate 2019
Annual Report and Accounts for the year ended 31 December 2025
13
Conclusions relating to going concern
Based on the work we have performed, we have not identified any material uncertainties relating to
events or conditions that, individually or collectively, may cast significant doubt on the syndicate’s ability
to continue as a going concern for a period of at least twelve months from when the syndicate annual
accounts are authorised for issue.
In auditing the syndicate annual accounts, we have concluded that the Managing Agent’s use of the
going concern basis of accounting in the preparation of the syndicate annual accounts is appropriate.
However, because not all future events or conditions can be predicted, this conclusion is not a guarantee
as to the syndicate's ability to continue as a going concern.
Our responsibilities and the responsibilities of the Managing Agent with respect to going concern are
described in the relevant sections of this report.
Reporting on other information
The other information comprises all of the information in the Annual Report other than the syndicate
annual accounts and our auditors’ report thereon. The Managing Agent is responsible for the other
information. Our opinion on the syndicate annual accounts does not cover the other information and,
accordingly, we do not express an audit opinion or, except to the extent otherwise explicitly stated in
this report, any form of assurance thereon.
In connection with our audit of the syndicate annual accounts, our responsibility is to read the other
information and, in doing so, consider whether the other information is materially inconsistent with the
syndicate annual accounts or our knowledge obtained in the audit, or otherwise appears to be materially
misstated. If we identify an apparent material inconsistency or material misstatement, we are required
to perform procedures to conclude whether there is a material misstatement of the syndicate annual
accounts or a material misstatement of the other information. If, based on the work we have performed,
we conclude that there is a material misstatement of this other information, we are required to report
that fact. We have nothing to report based on these responsibilities.
With respect to the Report of the Directors of the Managing Agent (the “Managing Agent’s Report”), we
also considered whether the disclosures required by The Insurance Accounts Directive (Lloyd’s
Syndicate and Aggregate Accounts) Regulations 2008 have been included.
Based on our work undertaken in the course of the audit, The Insurance Accounts Directive (Lloyd’s
Syndicate and Aggregate Accounts) Regulations 2008 requires us also to report certain opinions and
matters as described below.
Managing Agent’s Report
In our opinion, based on the work undertaken in the course of the audit, the information given in the
Managing Agent’s Report for the year ended 31 December 2025 is consistent with the syndicate annual
accounts and has been prepared in accordance with applicable legal requirements.
In light of the knowledge and understanding of the syndicate and its environment obtained in the course
of the audit, we did not identify any material misstatements in the Managing Agent’s Report.
Responsibilities for the syndicate annual accounts and the audit
Responsibilities of the Managing Agent for the syndicate annual accounts
As explained more fully in the Statement of Managing Agent’s Responsibilities, the Managing Agent is
responsible for the preparation of the syndicate annual accounts in accordance with the applicable
framework and for being satisfied that they give a true and fair view. The Managing Agent is also
Talbot Underwriting Ltd | Lloyd’s Syndicate 2019
Annual Report and Accounts for the year ended 31 December 2025
14
responsible for such internal control as they determine is necessary to enable the preparation of
syndicate annual accounts that are free from material misstatement, whether due to fraud or error.
In preparing the syndicate annual accounts, the Managing Agent is responsible for assessing the
syndicate’s ability to continue as a going concern, disclosing, as applicable, matters related to going
concern and using the going concern basis of accounting unless it is intended for the syndicate to cease
operations, or it has no realistic alternative but to do so.
Auditors’ responsibilities for the audit of the syndicate annual accounts
Our objectives are to obtain reasonable assurance about whether the syndicate annual accounts as a
whole are free from material misstatement, whether due to fraud or error, and to issue an auditors’ report
that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee
that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when
it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the
aggregate, they could reasonably be expected to influence the economic decisions of users taken on
the basis of these syndicate annual accounts.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design
procedures in line with our responsibilities, outlined above, to detect material misstatements in respect
of irregularities, including fraud. The extent to which our procedures are capable of detecting
irregularities, including fraud, is detailed below.
Based on our understanding of the syndicate and industry, we identified that the principal risks of non-
compliance with laws and regulations related to breaches of regulatory principles, such as those
governed by the Prudential Regulation Authority and the Financial Conduct Authority, and those
regulations set by the Council of Lloyd’s, and we considered the extent to which non-compliance might
have a material effect on the syndicate annual accounts. We also considered those laws and regulations
that have a direct impact on the syndicate annual accounts such as The Insurance Accounts Directive
(Lloyd’s Syndicate and Aggregate Accounts) Regulations 2008 and the Lloyd’s Syndicate Instructions.
We evaluated management’s incentives and opportunities for fraudulent manipulation of the syndicate
annual accounts (including the risk of override of controls), and determined that the principal risks were
related to management override of controls. Audit procedures performed by the engagement team
included:
Discussions with management, the Board, the compliance function and the Internal Audit Group
of the Managing Agent, including consideration of known or suspected instances of non-
compliance with laws and regulations, and fraud;
Assessment of matters reported on the Managing Agent’s whistleblowing helpline relevant to
the syndicate and the results of investigations of such matters;
Reviewing relevant meeting minutes and correspondence with regulatory authorities;
Testing and challenging where appropriate the assumptions and judgements made in
establishing significant accounting estimates;
Identifying and testing journal entries based on risk criteria; and
Designing audit procedures to incorporate unpredictability around the nature, timing and
extent of testing.
There are inherent limitations in the audit procedures described above. We are less likely to become
aware of instances of non-compliance with laws and regulations that are not closely related to events
and transactions reflected in the syndicate annual accounts. Also, the risk of not detecting a material
misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may
involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through
collusion.
A further description of our responsibilities for the audit of the syndicate annual accounts is located on
the FRC’s website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditors’
report.
Talbot Underwriting Ltd | Lloyd’s Syndicate 2019
Annual Report and Accounts for the year ended 31 December 2025
15
Use of this report
This report, including the opinions, has been prepared for and only for the syndicate’s member in
accordance with part 2 of The Insurance Accounts Directive (Lloyd’s Syndicate and Aggregate
Accounts) Regulations 2008 and for no other purpose. We do not, in giving these opinions, accept or
assume responsibility for any other purpose or to any other person to whom this report is shown or into
whose hands it may come save where expressly agreed by our prior consent in writing.
Other required reporting
Under The Insurance Accounts Directive (Lloyd’s Syndicate and Aggregate Accounts) Regulations 2008
we are required to report to you if, in our opinion:
● we have not obtained all the information and explanations we require for our audit; or
● adequate accounting records have not been kept by the Managing Agent in respect of the
syndicate; or
● certain disclosures of Managing Agent remuneration specified by law are not made; or
● the syndicate annual accounts are not in agreement with the accounting records.
We have no exceptions to report arising from this responsibility.
Other matter
We draw attention to the fact that this report may be included within a document to which iXBRL tagging
has been applied. This auditors’ report provides no assurance over whether the iXBRL tagging has been
applied in accordance with section 2 of the Lloyd’s Syndicate Instructions version 3.1.
Paul Pannell (Senior statutory auditor)
for and on behalf of PricewaterhouseCoopers LLP
Chartered Accountants and Statutory Auditors
London
19 February 2026
Talbot Underwriting Ltd | Lloyd’s Syndicate 2019
Annual Report and Accounts for the year ended 31 December 2025
16
Statement of profit or loss and other
comprehensive income:
Technical account – General business
For the year ended 31 December 2025
| Note | 2025 $000 | 2024 $000 | |
| Gross premiums written | 5 | ||
| Outwards reinsurance premiums | ( | ||
Premiums written, net of reinsurance | |||
Changes in unearned premium | 16 | ||
| Change in the gross provision for unearned premiums | |||
| Change in the provision for unearned premiums reinsurers’ share | | ||
Net change in provisions for unearned premiums | |||
Earned premiums, net of reinsurance | |||
Allocated investment return transferred from the non-technical account | 9 | ||
Claims paid | |||
| Gross amount | ( | ( | |
| Reinsurers’ share | | ||
Net claims paid | ( | ( | |
| Change in the provision for claims | 16 | ||
| Gross amount | ( | ||
| Reinsurers’ share | | ||
Net change in provisions for claims | ( ) | ||
Claims incurred, net of reinsurance | ( | ( | |
| Net operating expenses | 7 | ( | ( |
Balance on the technical account – general business |
Statement of profit or loss and other comprehensive income (continued)
Talbot Underwriting Ltd | Lloyd’s Syndicate 2019
Annual Report and Accounts for the year ended 31 December 2025
17
Non-technical account – General business
For the year ended 31 December 2025
There was no other comprehensive income or expense in the current or prior year.
The accompanying notes from page 22 to 50 form an integral part of these financial statements.
Note | 2025 $000 | 2024 $000 | |
Balance on the technical account – general business | |||
| Investment income | 9 | | |
| Realised gains/(losses) on investments | 9 | | ( |
| Unrealised gains/(losses) on investments | 9 | | |
| Investment expenses and charges | 9 | ( | ( |
Total investment return | |||
Allocated investment return transferred to the general business technical account | ( | ( | |
| Gain/(loss) on foreign exchange | | ( | |
Profit/(loss) for the financial year |
Talbot Underwriting Ltd | Lloyd’s Syndicate 2019
Annual Report and Accounts for the year ended 31 December 2025
18
Balance sheet – Assets
As at 31 December 2025
| Note | 2025 $000 | 2024 $000 | |
Investments | |||
| Financial investments | 11 | ||
| Deposits with ceding undertakings | | ||
Total investments | |||
| Reinsurers’ share of technical provisions | 16 | ||
| Provision for unearned premiums | | ||
| Claims outstanding | | ||
Total reinsurers’ share of technical provisions | |||
| Debtors | |||
| Debtors arising out of reinsurance operations | 12 | | |
| Other debtors | 13 | | |
Total debtors | |||
| Other assets | |||
| Cash at bank and in hand | 19 | ||
Total other assets | |||
| Prepayments and accrued income | |||
| Accrued interest | |||
| Deferred acquisition costs | 14 | | |
Total prepayments and accrued income | |||
Total assets |
Talbot Underwriting Ltd | Lloyd’s Syndicate 2019
Annual Report and Accounts for the year ended 31 December 2025
19
Balance sheet – Liabilities
As at 31 December 2025
| Note | 2025 $000 | 2024 $000 | |
| Capital and reserves | |||
| Member’s balances | |||
Total capital and reserves | |||
| Technical provisions | 16 | ||
| Provision for unearned premiums | |||
| Claims outstanding | |||
Total technical provisions | |||
| Creditors | |||
| Creditors arising out of reinsurance operations | 17 | | |
| Other creditors | 18 | | |
Total creditors | |||
| Accruals and deferred income | |||
| Accruals | |||
Total liabilities | |||
Total liabilities, capital and reserves |
The accompanying notes from page 22 to 50 form an integral part of these financial statements.
The financial statements on pages 16 to 50 were approved by the Board of Directors on 13 February
2026 and were signed on its behalf by;
RD Cowling, Chief Financial Officer
19 February 2026
Talbot Underwriting Ltd | Lloyd’s Syndicate 2019
Annual Report and Accounts for the year ended 31 December 2025
20
Statement of changes in member’s balances
For the year ended 31 December 2025
| 2025 $000 | 2024 $000 | |
| Member’s balances brought forward at 1 January | ( | |
| Total profit/(loss) for the year | ||
| Payments of profit to member’s reserve funds | ( | |
| Losses collected in relation to distribution on closure of underwriting year | ||
Member ’ s balances carried forward at 31 December |
The member participates on the Syndicate by reference to underwriting year of account.
Talbot Underwriting Ltd | Lloyd’s Syndicate 2019
Annual Report and Accounts for the year ended 31 December 2025
21
Statement of cash flows
For the year ended 31 December 2025
| Note | 2025 $000 | 2024 $000 | |
Cash flows from operating activities | |||
| Profit/(loss) for the financial year | | ||
Adjustments: | |||
| Increase/(decrease) in gross technical provisions | ( | ( | |
(Increase)/decrease in reinsurers’ share of gross technical provisions | | ||
| (Increase)/decrease in debtors | | ||
| Increase/(decrease) in creditors | | ( | |
| Movement in other assets/liabilities | | ||
| Investment return | ( | ( | |
| Foreign exchange | | ||
| Other | | ||
Net cash flows from operating activities | ( ) | ||
Cash flows from investing activities | |||
| Purchase of equity and debt instruments | ( | ( | |
| Sale of equity and debt instruments | | ||
| Investment income received | | ||
| Other | | ||
Net cash flows from investing activities | ( ) | ||
Cash flows from financing activities | |||
| Cash calls from member | | ||
| Distribution of profit | | ( | |
| Other | | ||
Net cash flows from financing activities | ( ) | ||
Net increase/(decrease) 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 end of year | 19 |
Talbot Underwriting Ltd | Lloyd’s Syndicate 2019
Annual Report and Accounts for the year ended 31 December 2025
22
Notes to the financial statements
1. Basis of preparation
The financial statements of Syndicate 2019 have been prepared in accordance with the Insurance
Accounts Directive (Lloyd’s Syndicate and Aggregate Accounts) Regulations 2008 and applicable
Accounting Standards in the United Kingdom and the Republic of Ireland, including Financial Reporting
Standard 102 (FRS 102). FRS 102 requires the application of 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 historical cost basis, except for financial assets at
fair value through profit or loss and available for sale that are measured at fair value.
The financial statements are presented in US dollars
All amounts have been rounded to the nearest thousand, unless otherwise indicated.
Going concern
The Syndicate has financial resources to meet its financial needs and manage its portfolio of insurance
risk. The directors have continued to review the business plans, liquidity and operational resilience of
the Syndicate and are satisfied that the Syndicate is well positioned to manage its business risks in the
current economic environment. The Syndicate 2026 underwriting year of account has opened and the
directors have concluded that the Syndicate has sufficient resources to, and a reasonable expectation
that it will, open a 2027 year of account. 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.
Accordingly, the directors of the Managing Agent continue to adopt the going concern basis in preparing
the annual report and financial statements.
2. Use of judgements and estimates
In preparing these financial statements, the directors of the Managing Agent have made judgements,
estimates and assumptions that affect the application of the Syndicate’s accounting policies and the
reported amounts of assets, liabilities, income and expenses.
The Syndicate makes critical judgements, estimates and assumptions concerning the future. The
resulting accounting estimates will, by definition, seldom equal the related actual results. The
judgements, estimates and assumptions that have a significant risk of causing a material adjustment to
the carrying amounts of assets and liabilities within the next financial year are addressed below.
Premium estimates
Significant estimates include premium written and the earning pattern of recognising premium over the
life of the policy.
The Syndicate writes a single annual quota share reinsurance contract. Premium written is initially based
on estimated premium income (EPI) recognised in full at inception based on what will be ultimately
written under the contract.
Premium estimates are reviewed at least quarterly. Quarterly EPI reflects actual underlying written
premium and forecast for future months, which are compared to plan and previous quarters’ actuals for
reasonableness. Premium estimates are subject to review and approval by the Active Underwriter and
Reserve Committee. A source of uncertainty arises from the fact that, at any given point in time, the EPI
could be different to final signed premium thereby leading to an adjustment that could be material.
Premium is earned on a straight-line basis for underlying AIG policies, which have been ceded under
the quota share contract.
Notes to the financial statements (continued)
Talbot Underwriting Ltd | Lloyd’s Syndicate 2019
Annual Report and Accounts for the year ended 31 December 2025
23
i. 2025 underwriting year of account
For the 2025 underwriting year, premium estimates from AIG are provided gross of reinsurance before
the Syndicate purchases it’s own reinsurance.
ii. 2024 and prior underwriting year of account
For the 2024 underwriting years and prior, the premium ceded to, and recognised by, the Syndicate
under the quota share contract is net of deemed reinsurance outlined within the quota share reinsurance
contract and applied by the cedent prior to cession to the Syndicate. The cedent’s reinsurance
programme is not exclusive to the portfolio of business ceded under the quota share contract and thus
the reinsurance applied prior to cession to the Syndicate represents an allocation of the total deemed
reinsurance coverage the cedent has purchased. EPI estimates for these periods also include estimates
for the reinsurance applied before the cession.
The allocation of reinsurance applied by AIG prior to cession is validated against modelling outputs as
well as placing broker analysis.
Claims provisions
Significant estimates include the estimate for insurance losses incurred but not reported (IBNR), which
is included in claims outstanding in the balance sheet. If this estimation were to prove inadequate then
a loss would arise in future years. The total gross IBNR at 31 December 2025 is $312.1m (2024:
$386.9m).
For the 2025 underwriting year of account, the Syndicate takes a quota share of the PCS Collections
portfolio, and external reinsurance is in place.
The Syndicate incurred to ultimate development of catastrophe claims can take longer to develop due
to the nature of the portfolio and coverage being provided for AIG HNW clients, impacting the 2024 and
prior underwriting years of account. The estimates of claims provisions allow for alternative living costs
and building code changes.
Deemed inuring reinsurance protection on the AIG HNW portfolio, impacting the 2024 and prior
underwriting years of account, applies before cession to the Syndicate. Catastrophe and other claims
may therefore develop up to a specific retention. The retention and limit of the deemed inuring
reinsurance coverage varies depending on the type of coverage and US state. There is no external
reinsurance cover in place for the 2024 and prior underwriting years of account; and
The process for estimating claims provisions considers key sources of uncertainty around the following:
The allocation of claims liabilities by underwriting year prior to cession to the Syndicate;
Future development of inward claims, both reported but unsettled, and IBNR;
Estimates of claims liabilities for catastrophe events;
The splits of future claim liabilities between earned and unearned exposures.
These significant estimates are made using data, assumptions, models and expert judgement by in-
house actuarial, claims and underwriting personnel and adopted only after suitable discussion and
challenge from management, through the Reserve Committee, and the Audit Committee. The data and
analysis used includes:
Quarterly cedent updates on expected premium volumes and rating levels in light of business
written and prevalent market conditions;
Quarterly claims and premium data, both gross and net of reinsurance, with the claims data being
both paid and reported and being segmented by the Syndicate’s classes of business. The
Syndicate’s catastrophe loss estimates are calculated quarterly by the PCS reinsurance Finance
team and are reported to the Syndicate;
Ongoing monitoring of actual emerging claims experience relative to that expected from the
reserving model, with quarterly monitoring of the ongoing suitability of the actuarial reserving
assumptions in light of the emerging experience; and
Talbot Underwriting Ltd | Lloyd’s Syndicate 2019
Annual Report and Accounts for the year ended 31 December 2025
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Annual detailed reviews of actuarial assumptions used in the reserving model, rate movements,
underwriting strategies, reinsurance protection, etc., on these assumptions; and
TUL receives the reserve data from the cedent and reviews these assumptions and judgements. TUL’s
Reserve Committee sets the claims liability provisions on a best estimate, undiscounted basis.
3. Significant accounting policies
The following significant accounting policies have been applied consistently in dealing with items which
are considered material in relation to the Syndicate’s financial statements.
A. Gross premiums written
Gross premiums written comprise premiums on contracts incepted during the financial year as well as
adjustments made in the year to premiums written in prior accounting periods. In each underwriting year
of account, the Syndicate writes a single quota share contract incepting on 1 January. Premiums are
shown gross of acquisition costs. Premiums include estimated amounts of premium due but not yet
received or notified.
B. Unearned premiums
Written premiums are recognised as earned according to the risk profile of the policy. Unearned
premiums represent the proportion of premiums written that relate to unexpired terms of policies in force
at the balance sheet date. The provision for unearned premiums is calculated on a pro rata basis. The
Syndicate underwrites risks attaching during (RAD) contracts for which premiums are earned in line with
the gross premiums to which the risk attaching contract relates.
C. Acquisition costs
Acquisition costs comprise the ceding commission as specified in the respective underwriting year of
account quota share contracts. The acquisition ratio is a blend of costs associated with premium earned
across each year of account in the period. The quota share acquisition ratio of 42.5% for the 2025
underwriting year of account has increased from the 2024 underwriting year of account (28.0%). The
deferred acquisition cost asset represents the proportion of acquisition costs, which corresponds to the
proportion of gross premiums written that is unearned at the balance sheet date.
D. Reinsurance
The Syndicate (from 1 January 2025 onwards) cedes reinsurance in the normal course of business.
Reinsurance premiums ceded and reinsurance recoveries on claims incurred are reported in the
respective expenditure and income accounts. Premiums ceded and claims reimbursed are presented
on a gross basis in the technical account and balance sheet as appropriate. Reinsurance outwards
premiums are earned according to the nature of the cover. ‘Losses occurring during’ policies are earned
evenly over the policy period. ‘Risks attaching’ policies are earned on the same basis as the inwards
business being protected.
Notes to the financial statements (continued)
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Annual Report and Accounts for the year ended 31 December 2025
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E. Claims provisions and related reinsurance recoveries
Provision is made at the year-end for the estimated cost of unpaid claims incurred.
In calculating the claims provisions, the Syndicate uses generally accepted estimation techniques
applied to underwriting year of account data, usually based upon analyses of historical experience,
which assume that the development pattern of future claims will be consistent with past experience.
Allowance is made, however, for changes or uncertainties which may create distortions in the underlying
statistics or which might cause the cost of unsettled claims to alter when compared with the cost of those
previously settled. Catastrophe and Large claims that impact specific classes of business are assessed
and measured on a case by case basis or projected separately.
The Syndicate writes a mix of predominantly short tail business, wherein most of the claims are settled
within relatively few years following the writing of the policy. A proportion of the Syndicate’s short tail
business is, however, low frequency and high severity in nature, which increases the volatility of the
data.
For longer tail business, where there are liability exposures, the time from the occurrence of a claim to
it being reported and the subsequent time before settlement of the claim can be many years. In this
time, additional facts regarding individual claims and trends often will become known and legislation and
case law may change, affecting the ultimate value of the claim.
Provisions are calculated net of any reinsurance recoveries.
Net ultimate claims provision are split between earned and unearned components, based upon earned
exposure at the balance sheet date.
The factors above bring considerable uncertainty to the process of estimating earned ultimate losses
and earned claims provisions.
The Directors consider that the claims provisions are fairly stated on the basis of the information
currently available to them. However, the ultimate liability may vary as a result of subsequent information
and this may result in significant adjustments in future years to the amounts provided.
F. Unexpired risks provision
Provision is made for unexpired risks arising from general insurance contracts where the expected value
of claims and expenses attributable to the unexpired periods of policies in force at the balance sheet
date exceeds the unearned premiums provision in relation to such policies (after the deduction of any
deferred acquisition costs). The provision for unexpired risks is calculated at the whole account level
and by underwriting year of account, after taking into account relevant investment return. The Syndicate
reinsures a single annual reinsurance contract and all business is reinsured together under one contract.
There are no unexpired risk provisions to be reported in the current or prior year.
G. Foreign currencies
Transactions in foreign currencies are translated to the functional currency using the exchange rates at
the date of the transactions. The Syndicate’s monetary assets and liabilities denominated in foreign
currencies are translated into the functional currency at the rates of exchange at the balance sheet date.
Non-monetary assets and liabilities denominated in foreign currencies that are measured at fair value
are retranslated to the functional currency at the exchange rate at the date that the fair value was
determined. Non-monetary items denominated in foreign currencies that are measured at historical cost
are translated to the functional currency using the exchange rate at the date of the transaction. For the
purposes of foreign currency translation, unearned premiums and deferred acquisition costs are treated
as if they are monetary items.
Differences arising on translation of foreign currency amounts relating to the insurance operations of the
Syndicate are included in the non-technical account. Differences arising on translation from the
functional currency to the presentational currency are recognised in other comprehensive income
.
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Annual Report and Accounts for the year ended 31 December 2025
26
H. Financial assets and liabilities
In applying FRS 102, the Syndicate has chosen to apply the recognition and measurement provisions
of Chapters 11 and 12 of FRS 102.
i. Classification
The accounting classification of financial assets and liabilities determines the way in which they are
measured and changes in those values are presented in the statement of profit or loss and other
comprehensive income. Financial assets and liabilities are classified on their initial recognition.
The initial classification of a financial instrument shall take into account contractual terms including those
relating to future variations. Once the classification of a financial instrument is determined at initial
recognition, re-assessment is only required subsequently when there has been a modification of
contractual terms that is relevant to an assessment of the classification.
Financial assets and financial liabilities at fair value through profit and loss comprise financial assets
and financial liabilities held for trading and those designated as such on initial recognition. Investments
in shares and other variable yield securities and debt and other fixed income securities are designated
as at fair value through profit or loss on initial recognition, as they are managed on a fair value basis in
accordance with the Syndicate’s investment strategy.
Deposits with credit institutions, debtors, and accrued interest are classified as loans and receivables.
ii. Recognition
Financial instruments are recognised when the Syndicate becomes a party to the contractual provisions
of the instrument. Financial assets are derecognised if the Syndicate’s contractual rights to the cash
flows from the financial assets expire or if the Syndicate transfers the financial asset to another party
without retaining control of substantially all risks and rewards of the asset. A financial liability is
derecognised when its contractual obligations are discharged, cancelled or expired.
Purchases and sales of financial assets are recognised and derecognised, as applicable, on the trade
date, i.e., the date that the Syndicate commits itself to purchase or sell the asset.
iii. Measurement
A financial asset or financial liability is measured initially at fair value plus, for a financial asset or financial
liability not at fair value through profit or loss, transaction costs that are directly attributable to its
acquisition or issue.
Financial assets at fair value through profit or loss are measured at fair value with fair value changes
recognised immediately in profit or loss. Net gains or net losses on financial assets measured at fair
value through profit or loss includes foreign exchange gains/losses arising on their translation to the
functional currency but excludes interest and dividend income.
Loans and receivables and financial liabilities are measured at amortised cost, except Syndicate Loans
to the Central Fund which are measured at fair value through profit or loss.
iv. Identification and measurement of impairment
At each reporting date the Syndicate assesses whether there is objective evidence that financial assets
not at fair value through profit or loss are impaired. Financial assets are impaired when objective
evidence demonstrates that a loss event has occurred after the initial recognition of an asset, and that
the loss event has an impact on the future cash flows of the asset that can be estimated reliably.
Objective evidence that financial assets are impaired includes observable data that comes to the
attention of the Syndicate about any significant financial difficulty of the issuer, or significant changes in
the technological, market, economic or legal environment in which the issuer operates.
Impairment losses on available for sale financial assets are recognised by reclassifying the losses
accumulated in other comprehensive income to profit or loss. The net cumulative loss that is reclassified
from other comprehensive income to profit or loss is the difference between the acquisition cost, net of
any principal repayment, and the current fair value, less any impairment loss recognised previously in
Notes to the financial statements (continued)
Talbot Underwriting Ltd | Lloyd’s Syndicate 2019
Annual Report and Accounts for the year ended 31 December 2025
27
profit or loss. If, in a subsequent period, the fair value of an impaired available for sale debt security
increases and the increase can be related objectively to an event occurring after the impairment loss
was recognised, the impairment loss is reversed through profit or loss. Otherwise it is reversed through
the statement of comprehensive income.
v. Off-setting
Financial assets and financial liabilities are offset, and the net amount presented in the balance sheet
when, and only when, the Syndicate has a legal right to set off the amounts and intends either to settle
on a net basis or to realise the asset and settle the liability simultaneously.
I. Investment return
Investment return comprises investment income and movements in unrealised gains and losses on
financial instruments at fair value through profit or loss, less investment management expenses, interest
expense, realised losses and impairment losses. Investment income comprises interest income,
dividends receivable and realised investment gains.
For the purpose of separately presenting investment income and unrealised gains and losses for
financial assets at fair value through profit or loss, interest income is calculated using the effective
interest method excluding transaction costs that are expensed when incurred. For investments at fair
value through profit or loss, realised gains and losses represent the difference between the net proceeds
on disposal and the purchase price.
Unrealised investment gains and losses represent the difference between the fair value at the balance
sheet date and the fair value at the previous balance sheet date, or purchase price if acquired during
the year. Movements in unrealised investment gains and losses comprise the increase/decrease in the
reporting period in the value of the investments held at the reporting date and the reversal of unrealised
investment gains and losses recognised in earlier reporting periods in respect of investment disposals
of the current period.
Investment return is initially recorded in the non-technical account. The return is typically transferred in
full to the general business technical account to reflect the investment return on funds supporting
underwriting business.
J. Cash and cash equivalents
Cash and cash equivalents comprise cash balances and call deposits with maturities of three months
or less from the acquisition date that are subject to an insignificant risk of changes in fair value and are
used by the Syndicate in the management of its short-term commitments.
Cash and cash equivalents are carried at amortised cost in the balance sheet.
Bank overdrafts that are repayable on demand and form an integral part of the Syndicate’s cash
management are included as a component of cash and cash equivalents for the purpose of the
statement of cash flows.
K. Taxation
Under Schedule 19 of the Finance Act 1993 Managing Agents are not required to deduct basic rate
income tax from trading income. In addition, all UK basic rate income tax deducted from Syndicate
investment income is recoverable by managing agents and consequently the distribution made to
members or their members’ agents is gross of tax. Capital appreciation falls within trading income and
is also distributed gross of tax.
No provision has been made for any United States Federal Income Tax payable on underwriting results
or investment earnings. Any payments on account made by the Syndicate during the year have been
included in the balance sheet under the heading ‘other debtors’.
No provision has been made for any other overseas tax payable by members on underwriting results.
Talbot Underwriting Ltd | Lloyd’s Syndicate 2019
Annual Report and Accounts for the year ended 31 December 2025
28
L. Profit commission
Profit commissions payable to the managing agent, which are expected to arise on closure of a Lloyd’s
year of account, are recognised on an accruals basis, taking into consideration any deficit clauses. The
managing agent’s charges do not include profit commission.
M. Operating expenses
Syndicate operating expenses are allocated to the year of account for which they are incurred. Where
expenses incurred in a financial year do not relate to any specific underwriting year of account they are
apportioned between years of account based the volume of business transacted.
N. Debtors and creditors
Insurance debtors and creditors include amounts due to and from brokers and contract holders. These
are classified as insurance debtors and creditors as they are non-derivative financial assets with fixed
or determinable payments that are not quoted on an active market.
Other debtors principally consist of sundry debtors and are carried at amortised cost.
Other creditors principally consist of amounts due to related entities and other sundry payables. These
are stated at amortised cost.
O. Classification of insurance and reinsurance contracts
Insurance and reinsurance contracts are classified as insurance contracts where they transfer significant
insurance risk. If a contract does not transfer significant insurance risk it is classified as a financial
instrument. All of the Syndicates written contracts and purchased reinsurance contracts transfer
significant insurance risk and therefore are recognised as insurance contracts.
P. Comparative disclosure
Comparative balances for the year ended 31 December 2024 have been restated.
Note 5 – Analysis of the underwriting result as the prior year comparative incorrectly included investment
return in the underwriting result; and
Note 11 – Financial investments (cost) included the syndicate loan original cost within both the shares
and other variable yield securities line as well as the syndicate loan line.
4. Risk and capital management
A. Introduction and overview
This note presents information about the nature and extent of insurance, financial, operational and
climate change risks to which the Syndicate is exposed, the Managing Agent’s objectives, policies and
processes for measuring and managing insurance and financial risks, and for managing the Syndicate’s
capital.
B. Risk governance
The Managing Agent for the Syndicate, TUL, is responsible for the management of risk at the Syndicate
level. The Board has overall responsibility for the establishment and oversight of the Syndicate’s risk
management framework. Risk management policies and procedures are established to identify and
analyse the risks faced by the Syndicate, to set appropriate risk appetite, limits and controls, and to
monitor risks and adherence to limits. The Board has established a Risk and Compliance Committee to
oversee the operation of the Syndicate’s risk management framework and to review and monitor the
management of the risks to which the Syndicate is exposed.
Risk oversight by the Board Risk and Compliance Committee is supplemented by specific risk oversight
from two other Board sub-committees: the Audit Committee for reserving, financial reporting, market,
credit and liquidity risks; and the People and Remuneration Committee for people risks.
All material risks are recorded on a comprehensive risk register for the Syndicate and TUL and are
managed by the business in line with the established set of risk appetite limits, risk policies and
Notes to the financial statements (continued)
Talbot Underwriting Ltd | Lloyd’s Syndicate 2019
Annual Report and Accounts for the year ended 31 December 2025
29
procedures, monitoring and mitigations, enabling new risks to be identified and new controls to be put
in place as necessary either to reduce the likelihood of a risk event or to mitigate its impact once it has
happened.
Executive oversight of the risk management framework is delegated to the Chief Executive Officer, who
is responsible for ensuring that risk management is embedded as part of TUL’s culture and that risks
are properly managed and mitigated through appropriate controls, operating effectively.
The Chief Executive Officer has formed an Executive Committee to support the discharge of the duties
delegated from the Board. The Executive Committee oversees the management of the key risks with
regard to strategy and relationships with key stakeholders and has established a number of
management committees that support oversight of how risk is managed by the business including the
following:
Syndicate 2019 Steering Committee (responsible for general oversight of the Syndicate);
Underwriting Committee (responsible for overseeing underwriting and reinsurance risks);
Reserve Committee (responsible for overseeing reserve risk);
Aggregation Risk Committee (responsible for overseeing systemic risk);
Sustainability Committee (responsible for developing and embedding the framework for overseeing
climate change risk);
Investment Committee (responsible for overseeing market risk and credit risk with regard to
investments);
Operational Risk Committee (responsible for overseeing operational risks); and
Internal Model Governance Committee (responsible for overseeing the Internal Model).
C. Insurance risk
Insurance risk is defined as the risk of actual claims experience and/or policyholder behaviour being
materially different than initially expected at the inception of an insurance contract or at the latest
valuation. Uncertainties related to insurance risk can lead to deviations in magnitude and/or time of
prospective cash flows associated with the Syndicate’s liabilities compared to what is expected.
Insurance risk can be categorised into underwriting risk and reserve risk.
a. Underwriting risk
Underwriting risk is the risk that in aggregate insurance premiums will not be sufficient to cover future
insurance claims and associated expenses. This might arise because premiums are set too low for the
cover provided, or because the actual timing, frequency, severity or aggregation of claims events is
higher than was expected during the underwriting process.
i. Management of underwriting risk
Underwriting risk arises from differences in timing, frequency and severity of insured events, relative to
expectations at the time of underwriting, as well as inappropriate pricing, selection and approval of
insurance risks.
Underwriting strategy is agreed by the Board and is set out in the Syndicate business plan that is
submitted to the Society of Lloyd’s for approval each year. Underwriting is aligned with the Syndicate’s
strategy, agreed business plan and underwriting policy.
The nature of the business exposes the Syndicate to various kinds of natural disaster, such as
hurricanes, windstorms, hailstorms, flooding, earthquakes, wildfires, and other catastrophes, in which
multiple losses can occur and affect multiple lines of business in any given year. TUL’s Risk Appetite
Framework establishes and maintains appropriate limits on the material risks identified. A significant
proportion of the natural catastrophe-related risks that are underwritten by AIG are renewed on an
annual basis. This provides the opportunity to regularly re-underwrite and re-price the risk. TUL, in
combination with AIG, uses a blend of proprietary and third-party risk models to help better understand
Talbot Underwriting Ltd | Lloyd’s Syndicate 2019
Annual Report and Accounts for the year ended 31 December 2025
30
the frequency and severity of natural catastrophe risk. TUL and AIG have assembled a collection of
hazard and engineering data, client and industry exposure, and loss information all of which have been
used to analyse the external catastrophe models, inform catastrophe model selections, and support
catastrophe model calibrations which form the in-house view of catastrophe risk. For weather perils TUL
models the following natural catastrophe perils: (1) cyclones, typhoons and hurricanes; (2) storm surge;
(3) earthquakes; (4) flooding; (5) wildfires; (6) severe convective storms; and (7) extratropical storms.
TUL has a clear approach for how catastrophe risk is represented in the Internal Model and this includes
validation and governance around model selection, model peril evaluation, model use, and model
change. Wider climate risk impacts to the Syndicate and their mitigation are detailed in note 4(f) below.
b. Reserve risk
Reserve risk is the risk that the reserves established in respect of insurance claims and claim expenses
incurred at the balance sheet date, whether reported or incurred but not reported (IBNR), are insufficient
to settle those claims and associated expenses in full. The level of uncertainty in the reserves set can
vary significantly across lines of business. It can arise from inadequate reserving data and processes
or from the naturally uncertain progress of insurance events.
i. Management of reserve risk
The Syndicate has exposure to volatile lines of business that carry inherent risk that the ultimate claims
settlement will vary from previous assessments of reserves. The Syndicate reserves are annually
subject to a formal independent actuarial opinion. The actuarial opinions are covered by a combination
of formal Actuarial Professional Standards and specific Lloyd’s guidance and rules.
Note 2 contains additional details around the key judgements and uncertainties involved in the estimate
for claims provisions as well as how these are managed and overseen. The Syndicate also has in place
detailed procedures and controls to manage and monitor the handling and assessment of claims and
the setting of appropriate reserves. Note 15 includes further detail on claims provisions and claims
development triangles.
The Syndicate’s quarterly reserves are reviewed and approved by the Reserve Committee, reporting to
the Executive Committee, and overseen by the Audit Committee. The Syndicate reserves are also
subject to an annual, independent statement of actuarial opinion (SAO). The work of the in-house
actuarial team and of the third-party actuaries providing the SAO is carried out in compliance with the
relevant principles, guidance and rules published by Lloyd’s, with the formal Actuarial Professional
Standards published by the Institute and Faculty of Actuaries, and with the Technical Actuarial
Standards published by the Financial Reporting Council (FRC).
ii. Sensitivity to reserve risk
The reserves established could ultimately prove to be significantly lower or higher than the actual cost
of settling the claims arising. This level of uncertainty varies between classes of business and the nature
of the risk being underwritten and can arise from developments in case reserving for large losses and
catastrophes, or from changes in estimates of claims IBNR.
The following table illustrates the sensitivity of the insurance reserves disclosed in the accounts to
movements in the assumptions applied within the reserving process. Given the nature of the business
underwritten by the Syndicate, the approach to calculating the reserves for each class can vary and as
a result the sensitivity performed is to apply a beneficial and adverse risk margin to the total insurance
liability.
The amount disclosed in the table represents the profit or loss impact of an increase or decrease in the
insurance liability, gross and net of reinsurance, as a result of applying the sensitivity, being a 5 basis
points increase or decrease in the loss ratio.
Notes to the financial statements (continued)
Talbot Underwriting Ltd | Lloyd’s Syndicate 2019
Annual Report and Accounts for the year ended 31 December 2025
31
General insurance business sensitivities as at 31 December 202 5 | +5.0% $000 | -5.0% $000 |
| Claims outstanding – gross of reinsurance | ( | |
| Claims outstanding – net of reinsurance | ( | |
General insurance business sensitivities as at | +5.0% $000 | -5.0% $000 |
| Claims outstanding – gross of reinsurance | ( | |
| Claims outstanding – net of reinsurance | ( |
D. Financial risk
The focus of financial risk management for the Syndicate is ensuring that the proceeds from its financial
assets are sufficient to fund the obligations arising from its insurance contracts. The goal of the
investment management process is to optimise the risk-adjusted investment income and risk-adjusted
total return by investing in a diversified portfolio of securities, whilst ensuring that the syndicate can meet
its liabilities as they fall due.
a. Credit risk
Credit risk is defined as the risk that our customers or counterparties are unable or unwilling to repay
their contractual obligations when they become due. Credit risk may also result from a downgrade of a
counterparty’s credit ratings or a widening of its credit spreads.
The Syndicate is exposed to credit risk across its asset portfolio.
The nature of the Syndicate’s exposures to credit risk and its objectives, policies and processes for
managing credit risk have not changed significantly from the prior year.
i. Management of credit risk
Investment counterparties
Investment guidelines require that the Syndicate’s investments are held in high quality instruments. The
portfolio is monitored for concentration with respect to issuers and credit ratings. Credit risk exposures
are calculated regularly and compared with authorised credit limits before further transactions are
undertaken with counterparties. Of the investments and cash balances as at 31 December 2025, 91.4%
are with counterparties having a credit agency rating of A or better (2024: 91.9% of balances A or better).
Reinsurance counterparties
Reinsurance is placed with reinsurers who generally have a rating of A or above and who have a good
record of claims payment. New reinsurers are approved by the Broker and Reinsurance Security
Committee (a sub-committee of the Finance Committee). As at 31 December 2025, there are no
reinsurance balances receivable (2024: nil).
Broker and coverholder counterparties
The quota share contracts for both the 2025 and 2024 and prior underwriting years of account are
entirely written through Aon plc, which has a credit rating of BBB+ from Fitch Ratings (2024: BBB+).
The Syndicate has no premiums receivable that are past due at the reporting date (2024: nil).
Talbot Underwriting Ltd | Lloyd’s Syndicate 2019
Annual Report and Accounts for the year ended 31 December 2025
32
ii. Exposure to credit risk
The carrying amount of financial assets represents the maximum credit risk exposure.
The following table analyses the credit rating by investment grade of the Syndicate’s following assets:
31 December 2025 | AAA $ 000 | AA $ 000 | A $ 000 | BBB $ 000 | Other $ 000 | Not rated $ 000 | Total $ 000 |
Debt securities and other fixed income securities | |||||||
Shares and other variable yield securities | |||||||
| Lloyd’s overseas deposits | |||||||
| Syndicate loans to Central Fund | | ||||||
Debtors arising out of reinsurance operations | |||||||
| Other debtors and accrued interest | | ||||||
| Cash at bank and in hand | |||||||
Total |
31 December 2024 | AAA $000 | AA $000 | A $000 | BBB $000 | Other $000 | Not rated $000 | Total $ 000 |
Debt securities and other fixed income securities | |||||||
Shares and other variable yield securities | |||||||
| Lloyd’s overseas deposits | |||||||
| Syndicate loans to Central Fund | | ||||||
Debtors arising out of reinsurance operations | |||||||
| Other debtors and accrued interest | | ||||||
| Cash at bank and in hand | |||||||
Total |
Notes to the financial statements (continued)
Talbot Underwriting Ltd | Lloyd’s Syndicate 2019
Annual Report and Accounts for the year ended 31 December 2025
33
iii. Financial assets that are past due or impaired
The balance of financial assets that are past due but not impaired as at the reporting date is nil (2024:
nil).
Neither past due nor impaired assets | Past due but not impaired assets | Total | |
31 December 202 5 | $ 000 | $ 000 | $ 000 |
| Debt securities and other fixed income securities | |||
| Shares and other variable yield securities | |||
| Lloyd’s overseas deposits | |||
| Syndicate loans to the Central Fund | |||
| Debtors arising out of reinsurance operations | |||
| Other debtors and accrued interest | |||
| Cash at bank and in hand | |||
Total |
Neither past due nor impaired assets | Past due but not impaired assets | Total | |
31 December 2024 | $000 | $000 | $000 |
| Debt securities and other fixed income securities | | ||
| Shares and other variable yield securities | | ||
| Lloyd’s overseas deposits | |||
| Syndicate loans to the Central Fund | | ||
| Debtors arising out of reinsurance operations | | ||
| Other debtors and accrued interest | |||
| Cash at bank and in hand | |||
Total |
Talbot Underwriting Ltd | Lloyd’s Syndicate 2019
Annual Report and Accounts for the year ended 31 December 2025
34
b. Liquidity risk
Liquidity risk is defined as the risk that the Syndicate's financial condition will be adversely affected by
the inability or perceived inability to meet its short-term cash, collateral or other financial obligations as
they fall.
The Syndicate is exposed to quarterly calls on its available cash resources from claims arising from its
reinsurance contract. The nature of the Syndicate’s exposures to liquidity risk and its objectives, policies
and processes for managing liquidity risk have not changed significantly from the prior year.
i. Management of liquidity risk
The Syndicate’s goal for approach to managing liquidity risk is to ensure, as far as possible, that it will
always have sufficient liquidity to meet its liabilities when they fall due, under both normal and stressed
conditions.
The Syndicate’s approach to managing its liquidity risk is as follows:
Forecasts are prepared and reviewed on a regular basis to predict cash outflows from insurance
contracts over the short, medium and long term, in both normal and stressed circumstances;
The Syndicate regularly reviews stress tests to ensure that adequate liquid financial resources
are in place to meet obligations as they fall due in the event of reasonably foreseeable abnormal
circumstances.
Syndicate cash flow forecasts are reviewed periodically by the Investment Committee.
Liquidity is also considered periodically by the Investment Committee, the Audit Committee
and the Board, when reviewing asset allocation constraints within the investment guidelines.
After 1 October 2022, no collateral is required to be posted to the Credit for Reinsurance Trust Fund
(CRTF). All of the Syndicate’s business is in scope of CRTF requirements. With no ongoing requirement
from this date, funds have been released from the trust, which have resulted in improvement in the
Syndicate’s liquidity during recent financial years.
ii. Maturity analysis of syndicate liabilities
The maturity analysis presented in the table below shows the remaining contractual maturities for the
Syndicate’s insurance contracts and financial instruments. For insurance and reinsurance contracts, the
contractual maturity is taken to be the estimated date when the final gross undiscounted contractually
required cash flows will occur. For financial liabilities, it is taken to be 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.
At 31 December 2025, the average duration of Syndicate funds to maturity was 1.9 years (2024: 2.3
years) compared to 1.8 years (2024: 1.9 years) for Syndicate claims outstanding.
Undiscounted net cash flows
31 December 2025 | No maturity stated $ 000 | 0-1 yrs $ 000 | 1-3 yrs $ 000 | 3-5 yrs $ 000 | >5 yrs $ 000 | Total $ 000 |
| Claims outstanding | | |||||
| Creditors | | |||||
Total |
Undiscounted net cash flows
31 December 2024 | No maturity stated $000 | 0-1 yrs $000 | 1-3 yrs $000 | 3-5 yrs $000 | >5 yrs $000 | Total $000 |
| Claims outstanding | | |||||
| Creditors | | |||||
Total |
Notes to the financial statements (continued)
Talbot Underwriting Ltd | Lloyd’s Syndicate 2019
Annual Report and Accounts for the year ended 31 December 2025
35
c. Market risk
Market risk is defined as the risk of adverse impact due to systemic movements in one or more of the
following market risk drivers: equity and commodity prices, residential and commercial real estate
values, interest rates, credit spreads, foreign exchange, inflation, and their respective levels of
uncertainty. Market risk can also be influenced by political turmoil, natural disasters, and terrorist
attacks.
The objective of market risk management is to manage and control market risk exposure within the
Board’s risk appetite, while optimising the return on risk subject to preserving capital. The nature of the
Syndicate exposure to market risk and its objectives, policies and processes for managing market risk
have not changed significantly from the prior year.
i. Management of market risks
For each of the major components of market risk the Syndicate has policies and procedures in place
which detail how each risk should be managed and monitored. The management of each of these major
components of major risk and the exposure of the Syndicate at the reporting date to each major risk are
outlined below.
Interest rate risk
This is the risk that an increase in interest rates or volatility in the fixed income markets could result in
significant unrealised or realised losses in the market value of the investment portfolio. The Syndicate
is exposed to interest rate risk arising on interest bearing assets. Assets with floating interest rates
expose the Syndicate to cash flow interest rate risk. Fixed interest rate assets expose the Syndicate to
fair value risk. The Syndicate’s strategy is to invest in high quality, liquid, fixed and floating rate interest
securities and cash and actively to manage duration. The investment portfolios are actively managed
to achieve a balance between cash flow interest rate risk and fair value interest rate risk bearing in mind
the need to meet the liquidity requirements of the business.
Currency risk
This is the risk that foreign exchange rate movements could impact the valuation of assets and liabilities
in the Syndicate’s reporting currency. The Syndicate’s results are reported in US dollars and assets and
liabilities are held primarily in US dollars. Therefore, there is minimal risk that fluctuations in exchange
rates would have a significant effect on the Syndicates results and net assets.
The profile of the assets and liabilities, categorised by currency at their translated carrying amounts is
as follows:
Sterling | US dollar | Euro | Canadian dollar | Australian dollar | Other | Total | |
31 December 202 5 | $000 | $000 | $000 | $000 | $000 | $000 | $000 |
| Financial Investments | |||||||
| Debtors | |||||||
| Other assets | |||||||
Prepayments and accrued income | |||||||
Total assets | |||||||
| Technical provisions | ( | ( | |||||
| Creditors | ( | ( | ( | ||||
| Accruals and deferred income | ( | ( | ( | ||||
Total liabilities | ( ) | ( ) | ( | ||||
Total capital and reserves | ( ) | ( ) | ( ) |
Talbot Underwriting Ltd | Lloyd’s Syndicate 2019
Annual Report and Accounts for the year ended 31 December 2025
36
Sterling | US dollar | Euro | Canadian dollar | Australian dollar | Other | Total | |
31 December 202 4 | $000 | $000 | $000 | $000 | $000 | $000 | $000 |
| Financial Investments | |||||||
| Debtors | |||||||
| Other assets | |||||||
Prepayments and accrued income | |||||||
Total assets | |||||||
| Technical provisions | ( | ( | |||||
| Creditors | ( | ( | ( | ||||
| Accruals and deferred income | ( | ( | ( | ||||
Total liabilities | ( | ( ) | ( ) | ||||
Total capital and reserves | ( ) | ( ) | ( ) |
ii. Sensitivity analysis to market risks
The analysis below considers reasonably possible movements in market indices on financial
instruments with all other variables held constant, showing the impact on the profit or loss and on the
members’ balance due to the ensuing changes in fair value of financial assets and liabilities (whose fair
values are recorded in the profit and loss account).
2025 Impact on results $000 | 2025 Impact on members’ balances $ 000 | 2024 Impact on results $000 | 2024 Impact on members’ balances $ 000 | |
Interest rate risk | ||||
| + 50 basis points shift in yield curves | ( | ( | ( | ( |
| - 50 basis points shift in yield curves | |
Currency risk
10 percent increase in US dollar/Sterling
exchange rate
831
831
895
895
10 percent decrease in US dollar/Sterling
exchange rate
(831)
(831)
(895)
(895)
A 10 percent increase (or decrease) in exchange rates and a 50 basis point increase (or decrease) in
yield curves have been selected on the basis that these are considered to be reasonably possible
changes in these risk variables over the following year.
The sensitivity analysis demonstrates the effect of a change in a key variable while other assumptions
remain unchanged. However, the occurrence of a change in a single market factor may lead to changes
in other market factors as a result of correlations.
Additionally, the sensitivity analysis is based on the Syndicate’s financial position at the reporting date
and that may vary at the time that any actual market movement occurs. For example, the sensitivity
analysis does not take into consideration that the Syndicate’s financial investments are actively
managed and if investment markets move past pre-determined trigger points, actions may be taken
which would alter the Syndicate’s position.
Notes to the financial statements (continued)
Talbot Underwriting Ltd | Lloyd’s Syndicate 2019
Annual Report and Accounts for the year ended 31 December 2025
37
E. Operational risk
Operational risk is defined as the risk of loss, or other adverse consequences, resulting from inadequate
or failed internal processes, people, systems, or from external events. Operational risk includes legal,
regulatory, technology, compliance, third-party and business continuity risks, but excludes business and
strategy risks.
Operational risks are managed by the business, reported and reviewed quarterly at the Operational Risk
Committee, reporting to the Executive Committee, and overseen by the Board’s Risk and Compliance
Committee.
During the year, particular attention continued to be focused on transformation risk following the sale of
Validus to RenaissanceRe in November 2023 and on operational resilience in preparation for a
regulatory deadline in March 2025, which was met.
Transformation risk
The sale of Validus necessitated an acceleration in the separation of TUL from Validus’ IT infrastructure
and support functions and migration to AIG’s. This process involves material transformation risk, which
is being carefully managed. Once complete it will facilitate closer strategic and operational alignment of
TUL with AIG, including full IT connectivity between TUL and AIG with greater efficiency and reduced
duplication of systems, applications and tools. TUL will have reliance on the same third parties as AIG
and will benefit from a managed IT infrastructure service, while retaining high-level oversight of the IT
environment and overall accountability for the IT infrastructure services provided to TUL by AIG.
To effect the transformation, TUL established detailed implementation plans for this work in late 2023
and early 2024, and subsequently began to execute the plans during 2024. The business has put in
place dedicated governance, oversight and mitigations for the work and the associated risks, including
contingency plans to roll changes back to a prior state if necessary. The work is subject to regular senior
management and Board scrutiny and oversight.
Execution against the plans has continued successfully throughout 2025 and at the end of the year, all
users, data and substantially all applications have been migrated. Three final applications remain in the
legacy IT environment and will be migrated in early 2026. The legacy IT environment is anticipated to
be decommissioned in the first quarter of 2026.
Operational resilience
A key element of TUL’s operational risk management is to maintain ongoing compliance with operational
resilience regulations. TUL achieves this with well-established business continuity and disaster recovery
plans in place and an Incident Management team, reporting to the Operational Risk Committee, to
oversee execution of these plans and compliance with the PRA’s operational resilience regulations. TUL
has maintained these plans as it transitions from locally operated IT services to AIG IT supported
services, incorporating resilience by design and extensive testing of applications as it has worked
through migrations. TUL has continued to engage with Lloyd’s and the LMA on operational resilience,
participating in market tests, and ensuring that TUL complies with Lloyd’s Principles in this area,
including ongoing scenario testing and third-party resilience.
As the Syndicate underwrites Quota Share treaty reinsurance, operations are also based within AIG in
North America, with premiums and claims being processed into the Syndicate under quarterly
bordereau. In accordance with the Syndicate’s established operating model, it continues to utilise
information from AIG for its key processes through a service level agreement and a quarterly attestation
process.
Talbot Underwriting Ltd | Lloyd’s Syndicate 2019
Annual Report and Accounts for the year ended 31 December 2025
38
F. Climate change risk
TUL recognises the material risk that climate change poses to its business and is committed to
embedding climate change considerations within its risk management and decision making.
TUL has committed to reaching net zero greenhouse gas (GHG) emissions across its underwriting and
investment portfolios by 2050, or sooner, aligned to the commitments of its parent, AIG. TUL’s initial
underwriting actions to these ends include no longer providing new insurance cover for thermal coal-
fired power plants, thermal coal mines, oil sands or Arctic energy exploration, as well as phasing out
existing insurance risks with clients that derive 30 percent or more of their revenues from these activities
by 1 January 2030 or sooner. Similarly, TUL’s initial investment actions include no longer investing in
new thermal coal-fired power plants, thermal coal mines, oil sands or new Arctic energy exploration
activities, as well as phasing out existing investments with companies that derive 30 percent or more of
their revenues from these activities, which was achieved in 2025. This is in line with Lloyd’s expectations
of the market.
TUL has also committed to reducing its own GHG emissions by reviewing energy efficiencies in its
facilities, business travel, printing and procurement areas. This is aligned to AIG’s Net Zero
Commitments and Climate Transition Plan, published in its 2024 Sustainability Report.
During 2025, the PRA published a consultation paper CP10/25, updating supervisory statement SS3/19,
concerning how insurers manage financial risks from climate change. The final supervisory statement
SS3/25 was published in December 2025.
The transition to a low carbon economy is likely to provide opportunities for TUL’s business strategy,
with the potential for new products and services to help clients and customers manage their climate-
related risks and improve resource efficiency.
Risks associated with climate change are commonly grouped under physical risks, transitional risks and
liability risks.
a. Physical risks
Physical risks from climate change arise from changing frequency, magnitude and location of severe
weather events (e.g. windstorms, floods and wildfires) and longer-term shifts in the climate (e.g. sea
level rise, increases in average temperatures and greater variability in weather events).
Physical climate change risks may have financial impacts on the Syndicate, for example through
challenging AIG’s ability to underwrite, model and price catastrophe risk effectively, particularly allowing
for change over time in the frequency and severity of catastrophe events.
AIG manages these physical risks through its risk appetite limits and underwriting by using risk models
that have been adjusted to allow for the impact of climate change over time, providing forward-looking
scenario analysis for natural catastrophe risk pricing. The claims and actuarial functions track specific
types of losses, including natural catastrophes, for which climate change may be an exacerbating factor
with the potential to worsen loss scenarios. They also work closely with the underwriting team to assess
the impact of those events on both the level of risk to which AIG might be exposed, and the pricing of
that risk. The business regularly reassesses the increasing frequency and severity of claims that may
stem from climate change impacts, as well as claims from emerging risks such as previously un-
modelled catastrophes.
Physical climate change risks impacting the Syndicate’s underwriting are also mitigated because the
majority of physical damage, catastrophe-exposed risks the Syndicate underwrites are renewed on an
annual basis. This provides TUL the opportunity to re-underwrite and re-price most risks annually.
Physical climate change risks may also have an operational impact, for example on individual facilities
and office locations. TUL also assesses and manages these as part of its regular management of
operational resilience.
Notes to the financial statements (continued)
Talbot Underwriting Ltd | Lloyd’s Syndicate 2019
Annual Report and Accounts for the year ended 31 December 2025
39
b. Transitional risks
Transitional risks from climate change arise from the adjustment of countries around the world to a low-
carbon economy (e.g. climate-related developments in policy and regulation, and the emergence of
new, possibly disruptive, technology and business models). Transitional risks around investment,
reputation and technology are discussed briefly below.
As the world starts to move away from a carbon-intensive economy, investment transitional risks may
arise if financial markets begin fundamentally to reassess the value of carbon-intensive assets and the
businesses that rely on them, leading to material change in their valuation and ongoing viability. The
changes to the Syndicate’s investment policy described above are designed to mitigate this risk in the
short term.
Investors, customers, regulators and other stakeholders are placing increasing importance on how the
companies with which they deal are addressing climate change and their expectations of those with
whom they do business are evolving. Companies that are unable to meet stakeholders’ expectations
could suffer from negative publicity and reputational harm, leading to the loss of business from customer
and loss of confidence from investor, which could adversely affect their operations. As a wholly-owned
subsidiary of AIG, TUL seeks to manage this risk by aligning with AIG’s approach and public
commitments to managing the financial risks and impacts of climate change.
Technological advancements that support the transition to a lower-carbon, energy-efficient economic
system may have a significant impact on a wide range of companies. The economic transition may also
materially affect the demand for insurance in specific sectors, most obviously in energy and transport.
Although this may not necessarily reduce the overall demand for insurance products and services, it
may alter the patterns of demand and the nature of insurance cover required. Working in alignment with
AIG, the Syndicate will need to respond to these changing demands albeit in relation to the specific lines
it reinsures in the future.
c. Liability risks
Liability risks may arise from parties who have suffered loss or damage attributable to physical or
transitional climate change risks and who seek to recover them from those they hold responsible. For
example, a material and sustained increase in the physical risk of flooding may affect the value of
multiple property assets, which could lead to increased credit risk for banks and other mortgage lenders
from loan defaults, which if it is material enough could lead to a reduction in their share price and
shareholder claims against their directors and officers. Alternatively, company share prices may fall if
they fail to address the impact of climate change on their business or are accused of making misleading
public statements about how they are addressing the impact of climate change, which could again lead
to shareholder claims against their directors and officers.
In recent years, the insurance industry has observed an increase in climate-related litigation and
therefore now incorporates climate litigation scenarios into its capital setting process. Modelling the
medium and long-term impacts of climate litigation is however an evolving area in light of the limited
amount of liability claims data currently available. TUL will therefore continue to monitor climate change
litigation trends to assess the potential impact of any developments on our business and our overall risk
mitigation strategies.
G. Corporate and social responsibilities
TUL is committed both to making lasting, positive change to the communities in which we operate and
to our employees.
TUL values Culture and Inclusion and seeks to embed this with a motivated and committed workforce,
equipped with the skills required to deliver the strategy and perform at their best. TUL is committed to
equitable pay and also identifies skill requirements and delivers these through training and recruitment
designed to attract, develop and retain diverse talent.
TUL works with a number of charities to raise funds and promote their cause, as well as supporting our
communities, either by financial charitable contributions or by donating time to a range of volunteering
initiatives. There are also a number of partnerships with non-profit initiatives, such as mentoring, to
extend our charitable reach.
Talbot Underwriting Ltd | Lloyd’s Syndicate 2019
Annual Report and Accounts for the year ended 31 December 2025
40
H. Capital management
i. Lloyd’s capital framework
The Society of Lloyd’s (Lloyd’s) is a regulated insurance and reinsurance marketplace that is subject to
supervision by the Prudential Regulatory Authority (PRA) under the Financial Services and Markets Act
2000, in accordance with the requirements of Solvency UK.
Within this supervisory framework, Lloyd’s applies capital requirements at member level, supported by
mutualised, centrally-held assets, to ensure that Lloyd’s can comply with the Solvency UK requirements,
and beyond that to meet its own financial strength, licencing and ratings objectives.
ii. Lloyd’s capital setting process
Lloyd’s capital setting process, as outlined below, uses capital requirements assessed at syndicate level
as a starting point, from which it agrees capital requirements for each member at Lloyd’s, this being the
level at which underwriting at Lloyd’s is capitalised. For this reason, the capital requirement in respect
of the Syndicate is not disclosed in these financial statements.
In order to meet Lloyd’s requirements, each Syndicate must calculate its Lloyd’s 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 (referred to as the
ultimate SCR or uSCR). The Syndicate must also calculate its regulatory SCR at the same confidence
level but reflecting uncertainty over a one-year time horizon (referred to as the one-year SCR or SCR1)
for Lloyd’s to use in meeting Solvency UK requirements. The SCRs of each Syndicate are subject to
review by Lloyd’s and approval by the Lloyd’s Capital and Planning Group (CPG).
A syndicate may be comprised of one or more underwriting members of Lloyd’s. Each member is liable
for its own share of underwriting liabilities on the Syndicates on which it is participating but not other
members’ shares. Accordingly, the capital requirements that Lloyd’s sets for each member operates on
a similar basis.
Each members’ SCR shall thus be determined by the sum of the members’ share of the Syndicate SCR
‘to ultimate’. Where a member participates on more than one syndicate, a credit for diversification is
provided to reflect the spread of risk, but consistent with determining an SCR which reflects the capital
requirement to cover a 1 in 200 loss ‘to ultimate’ for that member. Over and above this, Lloyd’s applies
a capital uplift to the members’ capital requirement, known as the Economic Capital Assessment (ECA).
The purpose of this uplift, which is a Lloyd’s not a Solvency UK requirement, is to meet Lloyd’s financial
strength, licence and ratings objectives. The capital uplift applied for 2025 was 35% (2024: 35%) of the
members’ SCR ‘to ultimate’.
iii. Provision of capital by members
Each member may provide capital to meet its ECA either by assets held in trust by Lloyd’s specifically
for that member, known as Funds at Lloyd’s (FAL), assets held and managed within a syndicate, known
as Funds in Syndicate (FIS), or as the members’ share of the members’ balances on each syndicate on
which it participates. See below for further details on FAL.
All of the assets less liabilities of the Syndicate, as represented in the members’ balances reported on
the balance sheet on page 19, represent resources available to meet the members’ Lloyd’s capital
requirements.
An additional level of security is the Central Fund to which all Syndicates contribute, based on their
premium income, for every underwriting year of account. In the event that a members’ resources are
exhausted, outstanding claims may be paid out of the Central Fund if approved by the Council of Lloyd’s.
iv. Funds at Lloyd’s
Every member is required to hold capital at Lloyd’s, which is held in trust as FAL. These funds are
intended primarily to cover circumstances where syndicate assets prove insufficient to meet participating
members’ underwriting liabilities from the syndicate. The level of FAL that Lloyd’s requires a member to
maintain is determined by Lloyd’s based on Prudential Regulatory Authority requirements. The
Notes to the financial statements (continued)
Talbot Underwriting Ltd | Lloyd’s Syndicate 2019
Annual Report and Accounts for the year ended 31 December 2025
41
determination of FAL has regard to a number of factors including the nature and amount of risk to be
underwritten by the member and an assessment of the reserving risk in respect of business that has
been underwritten, both of which are reflected in the SCR. Since FAL is not under the management of
the Managing Agent, no FAL amount has been included in these financial statements. However, the
Managing Agent is able to make a call on the members’ FAL to meet liquidity requirements or to settle
losses.
5. Analysis of underwriting result
An analysis of the underwriting result before investment return is presented in the table below:
2025 | Gross premiums written $ 000 | Gross premiums earned $ 000 | Gross claims incurred $ 000 | Gross operating expenses $ 000 | Reinsurance balance $ 000 | Underwriting result $ 000 |
| Reinsurance acceptances | | ( | ( | ( | ( | |
Total | ( ) | ( ) | ( | ( |
202 4 | Gross premiums written $ 000 | Gross premiums earned $ 000 | Gross claims incurred $ 000 | Gross operating expenses $ 000 | Reinsurance balance $ 000 | Underwriting result $ 000 |
| Reinsurance acceptances | | ( | ( | |||
Total | ( | ( |
Comparative balances for the year ended 31 December 2024 have been restated – refer to note 3P to
the financial statements for further details.
All business written by the Syndicate is reinsurance.
6. Movement in prior year’s provision for claims outstanding
Favourable movements amounting to $48,589k (2024: $49,297k) in the past year’s provision for claims
outstanding, net of expected reinsurance recoveries, are included in claims incurred, net of reinsurance.
2025
$
000
2024
$
000
Homeowner (32,642)
(50,152)
Auto (5,124)
6,473
Collections Fine Art (1,123)
(4,157)
Collection General Species (5,669)
(1,894)
Yacht 1,369
137
Excess Liability (6,213)
1,322
Workers Comp 813
(1,026)
Total
(
4
8
,
589
)
(
49
,
297
)
Talbot Underwriting Ltd | Lloyd’s Syndicate 2019
Annual Report and Accounts for the year ended 31 December 2025
42
7. Net operating expenses
2025 $ 000 | 2024 $ 000 | |
| Acquisition costs (brokerage and commission) | | |
| Change in deferred acquisition costs | ||
| Administrative expenses | ||
Net operating expenses |
An analysis of the amounts paid to the Syndicate’s auditor is given below. The audit and non-audit fees
are borne by Talbot Underwriting Services Ltd (TUSL) and are incorporated in the management fee
charged (included within the administrative expenses total above). Refer to note 20 for further details of
the management fee.
2025 $ 000 | 2024 $ 000 | |
Auditors’ remuneration: | ||
| fees payable to the Syndicate’s auditor for the audit of these financial statements | | |
fees payable to the Syndicate’s auditor in respect of other services pursuant to legislation |
Other services pursuant to legislation relate to the audit and review of Lloyd’s regulatory returns, the
provision of iXBRL tagging assurance, as well as the provision of the statement of actuarial opinion as
required by Lloyd’s Byelaws.
8. Key management personnel compensation
The Syndicate has no direct employees. The staff and key management personnel who provide services
to the Syndicate are employed by various group companies, which are responsible for paying their
remuneration. This includes amounts related to the services provided by the executive and non-
executive directors of the managing agent. Key management personnel includes TUL Directors and the
active underwriter. As disclosed in note 20, the Managing Agent charges the Syndicate a Managing
Agent’s fee based on gross written premium for services provided to the Syndicate. Therefore, other
than the Syndicate’s active underwriter, staff costs and numbers are not separately identified. Although
not separately charged to the Syndicate, the estimated aggregate emoluments of the active underwriter
are $385 k (2024: $338 k).
Notes to the financial statements (continued)
Talbot Underwriting Ltd | Lloyd’s Syndicate 2019
Annual Report and Accounts for the year ended 31 December 2025
43
9. Investment return
2025 $ 000 | 2024 $ 000 | |
Interest and similar income | ||
From financial assets designated at fair value through profit or loss | ||
| Interest and similar income | ||
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 | ( | ( |
| Investment management expenses | ( | ( |
Total investment return | ||
| Transferred to the technical account from the non-technical account | |
10. Distribution and open years of account
A distribution to the Corporate Member of $174,216 k will be proposed in relation to the 2023 closing
year of account (2024: $61,670 k collection from members in relation to the 2022 closing year of
account).
Talbot Underwriting Ltd | Lloyd’s Syndicate 2019
Annual Report and Accounts for the year ended 31 December 2025
44
11. Financial investments
Carrying value
Cost
2025 $ 000 | 2024 $ 000 | 2025 $ 000 | 2024 $ 000 | |
| Debt securities and other fixed income securities | | |||
| Shares and other variable yield securities | ||||
| Lloyd’s overseas deposits | ||||
| Syndicate loans to the Central Fund | ||||
Total financial investments |
Comparative balances for the year ended 31 December 2024 have been restated – refer to note 3P to
the financial statements for further details.
All financial investments are measured at fair value through profit or loss.
The Syndicate classifies its financial instruments held at fair value in its balance sheet using a fair value
hierarchy based on the inputs used in the valuation techniques as follows:
Level 1 – financial assets that are measured by reference to published quotes in an active market.
A financial instrument is regarded as quoted in an active market if quoted prices are readily and
regularly available from an exchange, dealer, broker, industry group, pricing service or regulatory
agency and those prices represent actual and regularly occurring market transactions on an arm’s
length basis.
Level 2 – financial assets measured using a valuation technique based on assumptions that are
supported by prices from observable current market transactions. For example, assets for which
pricing is obtained via pricing services but where prices have not been determined in an active
market, financial assets with fair values based on broker quotes, investments in private equity funds
with fair values obtained via fund managers and assets that are valued using the Syndicate’s own
models whereby the significant inputs into the assumptions are market observable.
Level 3 – financial assets measured using a valuation technique (model) based on assumptions
that are neither supported by prices from observable current market transactions in the same
instrument nor are they based on available market data. Therefore, unobservable inputs reflect the
Syndicate's own assumptions about the assumptions that market participants would use in pricing
the asset or liability (including assumptions about risk). These inputs are developed based on the
best information available, which might include the Syndicate’s own data.
The table below analyses financial instruments held at fair value in the Syndicate’s balance sheet at
the reporting date by its level in the fair value hierarchy.
2025 | Level 1 $000 | Level 2 $000 | Level 3 $000 | Total $000 |
| Debt securities and other fixed income securities | ||||
Shares and other variable yield securities and units in unit trusts | ||||
| Lloyd’s overseas deposits | ||||
| Syndicate loans to the Central Fund | ||||
| Total |
Notes to the financial statements (continued)
Talbot Underwriting Ltd | Lloyd’s Syndicate 2019
Annual Report and Accounts for the year ended 31 December 2025
45
202 4 | Level 1 $ 000 | Level 2 $ 000 | Level 3 $ 000 | Total $ 000 |
| Debt securities and other fixed income securities | ||||
Shares and other variable yield securities and units in unit trusts | ||||
| Lloyd’s overseas deposits | ||||
| Syndicate loans to the Central Fund | ||||
| Total |
Information on the methods and assumptions used to determine fair values for each major category of
financial instrument measured at fair value is provided below.
Debt securities are generally valued using prices provided by external pricing vendors. Pricing vendors
will often determine prices by consolidating prices of recent trades for identical or similar securities
obtained from a panel of market makers into a composite price. The pricing service may make
adjustments for the elapsed time from a trade date to the valuation date to `take into account available
market information. Lacking recently reported trades, pricing vendors will use modelling techniques to
determine a security price.
Shares and other variable securities and units in unit trusts are generally categorised as level 1 in the
fair value hierarchy except where they are not actively traded, in which case they are generally
measured at prices of recent transactions in the same instrument. The Syndicate has no exposure to
hedge funds.
Some government and supranational securities are listed on recognised exchanges and are generally
classified as level 1 in the fair value hierarchy. Those that are not listed on a recognised exchange are
generally based on composite prices of recent trades in the same instrument and are generally classified
as level 2 in the fair value hierarchy.
Corporate bonds, including asset backed securities that are not listed on a recognised exchange, or are
traded in an established over-the-counter market are also mainly valued using composite prices. Where
prices are based on multiple quotes and those quotes are based on actual recent transactions in the
same instrument the securities are classified as level 2, otherwise they are classified as level 3 in the
fair value hierarchy.
Management performs an analysis of the prices obtained from pricing vendors to ensure that they are
reasonable and produce a reasonable estimate of fair value. Management considers both qualitative
and quantitative factors as part of this analysis. Examples of analytical procedures performed include
reference to recent transactional activity for similar securities, review of pricing statistics and trends and
consideration of recent relevant market events.
Lloyd’s overseas deposits are lodged as a condition of conducting underwriting business in certain
countries or states within countries. These funds are managed by Lloyd’s Treasury Services.
Syndicate loans to the Lloyd’s Central Fund have previously been classified as level 3 assets. The
Syndicate loans were repaid to the Syndicate in full during 2025.
At the reporting date Level 1 and Level 2 financial assets and liabilities were valued using valuation
techniques based on observable market data. All of the investments categorised as Level 3 are fair
valued based on the inputs to the valuation technique used.
Talbot Underwriting Ltd | Lloyd’s Syndicate 2019
Annual Report and Accounts for the year ended 31 December 2025
46
12. Debtors arising out of reinsurance operations
| 2025 $ 000 | 2024 $ 000 | |
Reinsurance premiums due from ceding insurers and intermediaries within one year | ||
Total |
13. Other debtors
2025 $ 000 | 2024 $ 000 | |
| Other receivables | ||
Total |
Other receivables includes:
(1) $445k (2024: $388k) in respect of tax assets.
(2) $238k (2024: nil) in respect of investment receivables.
(3) $1,896k (2024: $2,258k) in respect of other debtors.
14. Deferred acquisition costs
The table below shows changes in deferred acquisition costs assets from the beginning of the period
to the end of the period.
202 5 | 202 4 | |||
Gross $ 000 | Net $ 000 | Gross $ 000 | Net $ 000 | |
| Balance at 1 January | ||||
| Incurred deferred acquisition costs | | |||
| Amortised deferred acquisition costs | ( | ( | ( | ( |
Balance at 31 December |
Notes to the financial statements (continued)
Talbot Underwriting Ltd | Lloyd’s Syndicate 2019
Annual Report and Accounts for the year ended 31 December 2025
47
15. Claims development
The following tables illustrate the development of the estimates of earned ultimate cumulative claims
incurred, including claims notified and IBNR, for each successive underwriting year, illustrating how
amounts estimated have changed from the first estimates made.
As these tables are on an underwriting year basis, there is an apparent large increase from amounts
reported for the end of the underwriting year to one year later as a large proportion of premiums are
earned in the year of account’s second year of development.
Balances have been translated at exchange rates prevailing at 31 December 2025 in all cases.
Gross: | |||||||
Pure underwriting year | 2020 | 2021 | 2022 | 2023 | 202 4 | 202 5 | Total |
$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 | |||||||
Estimate of gross claims liabilities | |||||||
Provision in respect of prior years | - | - | - | - | - | - | |
Less gross claims paid | ( | ( ) | ( | ( | ( | ( | ( |
Gross claims liabilities |
Net:
Pure underwriting year | 2020 | 2021 | 2022 | 2023 | 202 4 | 202 5 | Total |
$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 | |||||||
Estimate of net claims liabilities | |||||||
Provision in respect of prior years | - | - | - | - | - | - | |
Less net claims paid | ( | ( ) | ( | ( | ( | ( | ( |
Net claims liabilities |
Some business is not off-risk after the first 12 months, therefore it would be anticipated that cumulative
claims will increase in the second year as this business is earned.
Talbot Underwriting Ltd | Lloyd’s Syndicate 2019
Annual Report and Accounts for the year ended 31 December 2025
48
16. Technical provisions
The table below shows changes in the insurance contract liabilities and assets from the beginning of
the period to the end of the period.
202 5 | 202 4 | |||
| Gross provisions $ 000 | Net $ 000 | Gross provisions $ 000 | Net $ 000 | |
Claims outstanding | ||||
Balance at 1 January | ||||
| Claims paid during the year | ( | ( | ( | ( |
| Expected cost of current year claims | ||||
| Change in estimates of prior year provisions | ( | ( | ( | ( |
Balance at 31 December |
2025 | 2024 | |||||
Gross provisions $ 000 | Reinsurance assets $ 000 | Net $ 000 | Gross provisions $ 000 | Reinsurance assets $ 000 | Net $ 000 | |
Unearned premiums | ||||||
| Balance at 1 January | ||||||
Premiums written during the year | ( | |||||
Premiums earned during the year | ( | ( | ( | ( | ||
Balance at 31 December |
Refer to Note 4C(ii) 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.
17. Creditors arising out of reinsurance operations
2025 $ 000 | 2024 $ 000 | |
| Due within one year | ||
Total |
18. Other creditors
2025 $ 000 | 2024 $ 000 | |
| Amounts due to group companies | ||
Total |
Amounts owed to group companies are unsecured, interest free, have no fixed date of payment and
are payable on demand. Refer to note 20 for more details on the intra group loan.
Notes to the financial statements (continued)
Talbot Underwriting Ltd | Lloyd’s Syndicate 2019
Annual Report and Accounts for the year ended 31 December 2025
49
19. Cash and cash equivalents
2025 $ 000 | 2024 $ 000 | |
| Cash at bank and in hand | ||
| Short term debt instruments presented within other financial investments | | |
Total cash and cash equivalents |
20. Related parties
Parent Companies
The immediate parent company of Talbot Underwriting Ltd is Talbot Underwriting Holdings Ltd, a
company registered in England and Wales.
The ultimate parent and controlling party of TUL is American International Group, Inc. (AIG). The
registered office of which is 1271 Avenue of the Americas, New York, NY 10020, United States of
America. AIG is listed on the New York Stock Exchange.
Directors’ interests
JL Hancock and CJ Flatt held senior management positions and executive directorships within the AIG
group of companies during the year. P Bergamaschi previously held a position on the AIG Board of
Directors as an independent director and was paid fees accordingly.
Reinsurance
The Syndicate reinsured a single quota share contract for all of its underwriting years of account. This
quota share contract is with AIG group entities and was brokered and priced on an arm’s length basis.
The 2024 and prior underwriting year of account portfolio was protected by a reinsurance programme
comprising excess of loss, quota share and facultative covers, which is applied before premium is ceded
to the Syndicate.
The Syndicate also additionally purchases excess of loss reinsurance for the 2025 underwriting year of
account, although this is from the third party market.
Corporate member
PCG 2019 Corporate Member Limited (PCGCM), an AIG Company, has the following participation by
underwriting year 2020: 97.2%, 2021: 82.5%, 2022: 82.5%, 2023: 100%, 2024: 100% and 2025:
100%.
Managing agent
Talbot Underwriting Ltd is the Managing Agent of the Syndicate and the registered address is the AIG
Building, 58 Fenchurch Street, London, EC3M 4AB.
TUL charges the Syndicate an annual management fee. The annual fee for 2025 was $575k (2024:
$5,745k).
Intra group loan
The Syndicate has a loan facility in place with AIG Transaction Execution Limited (ATEL), a group entity.
At 31 December 2025, the balance of the loan is $45,000k (2024: nil). The loan facility has a limit of
$400,000k and the facility maturity date is 24 April 2030.
Talbot Underwriting Ltd | Lloyd’s Syndicate 2019
Annual Report and Accounts for the year ended 31 December 2025
50
21. Foreign exchange rates
The following currency exchange rates have been used for principal foreign currency transactions:
2025 2024
Start of period rate | End of period rate | Average rate | Start of period rate | End of period rate | Average rate | |
| Sterling | ||||||
| US dollar | |
