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ANNUAL
REPORT &
ACCOUNTS
2025
SYNDICATE
2232
Page
Directors and Administration ..................................................................................................................................2
Report of the Directors of the Managing Agent ......................................................................................................3
Statement of Managing Agent’s Responsibilities ...................................................................................................10
Independent Auditor's Report to the Member of Syndicate 2232 .........................................................................11
Profit and Loss Account: Technical Account - General Business.............................................................................15
Profit and Loss Account: Non-Technical Account ...................................................................................................16
Statement of Comprehensive Income.....................................................................................................................17
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
CONTENTS
Allied World Managing Agency Limited 1
Syndicate 2232 | Annual Report and Accounts 2025
Managing Agent
Managing Agent
The immediate holding company of Allied World Managing Agency Limited ("AWMA" or the "Managing Agent") is
Allied World Europe Holdings, Ltd, which is incorporated in Bermuda. AWMA's ultimate parent and to which the
results of AWMA are consolidated into is Fairfax Financial Holdings Limited ("Fairfax").
Directors
P Ford
K Graves (Independent Non-Executive)
T Hennessy (Independent Non-Executive)
S Hunter (Independent Non-Executive Chairperson)
S Liversidge (Independent Non-Executive)
E Moresco
M O'Leary
M Walsh
Company secretary
S Newton (Secretary)
Managing agent’s registered office:
19th Floor
20 Fenchurch Street
London
EC3M 3BY
Managing agent’s registered number
07249776
Syndicate
Active underwriter
S Kamath
Bankers
Citibank NA - London, New York and Singapore
RBC Dexia - Toronto
Independent auditors
PricewaterhouseCoopers LLP
Appointed actuary
KPMG LLP
DIRECTORS AND ADMINISTRATION
Allied World Managing Agency Limited 2
Syndicate 2232 | Annual Report and Accounts 2025
The Directors of AWMA, the managing agent, a company registered in England and Wales, present their report
and audited annual accounts for Syndicate 2232 ("the Syndicate") for the year ended 31 December 2025. The
registered address of AWMA is 19th Floor, 20 Fenchurch Street, London, EC3M 3BY.
Basis of Preparation
This Annual Report and Accounts 2025 are prepared using the annual basis of accounting as required by Statutory
Instrument No. 1950 of 2008, the Insurance Accounts Directive (Lloyd's Syndicate and Aggregate Accounts)
Regulations 2008 ("the 2008 Regulations"), and the Lloyd’s Syndicate Accounts Instructions Version 3.1 as
modified by the Frequently Asked Questions Version 1.1 issued by Lloyd’s.
Principal Activities
The principal activity of the Syndicate is the transaction of general insurance and reinsurance business. The
Syndicate underwrites a broad range of classes of business concentrating mainly on property and casualty
business written on both a direct and reinsurance basis. The Syndicate's capacity for the 2025 year was £477.5m
(2024: £435.3m).
The Directors have a reasonable expectation that the Syndicate and AWMA have adequate resources to continue
in operational existence for the foreseeable future. Therefore they continue to adopt the going concern basis of
accounting in preparing the financial statements.
Results
The result for the year ended 31 December 2025 was a profit on the technical account of £78.1m (2024: £55.9m)
with a net combined ratio of 82.8% (2024: 84.4%). The increase in member's balance to £102.6m (2024: £79.0m) is
reflective of the strong underwriting performance in the year.
The Syndicate’s key financial performance indicators during the year were as follows:
2025
£000
2024
£000
Gross premium written
520,390 472,464
Gross premium earned
481,948 436,151
Net premium earned
295,225 270,383
Balance on technical account
78,072 55,946
Member's balance 102,577 79,019
2025
%
2024
%
Gross combined ratio
80.1 87.9
Net combined ratio 82.8 84.4
Review of the Business
The Syndicate’s business is produced through the Lloyd’s broker network and written in the subscription market,
in either a lead or follow capacity. The Syndicate is a member of the Lloyd's Asia platform in Singapore through
Allied World Syndicate Services (Singapore) Pte. Ltd and also operates through service companies in Miami (Allied
World Reinsurance Management Company), and Bermuda (Allied World Syndicate Services (Bermuda), Ltd). We
are also an active market participant in Lloyd’s Europe (“LIC”) servicing our EU clients on this platform.
REPORT OF THE DIRECTORS OF THE MANAGING AGENT
Allied World Managing Agency Limited 3
Syndicate 2232 | Annual Report and Accounts 2025
Review of the Business (continued)
The Syndicate has used the opportunities that the Lloyd’s brand provides to pursue targeted growth in line with
the following strategic goals:
• Syndicate Oversight: maintain our “outperforming” status with Lloyd’s.
• Profitability: target a combined ratio of 95% or lower on a whole account basis.
• Capital: maximise our capital employed by having a well-balanced global portfolio, with increased
diversification which will ultimately boost our return on capital.
• Underwriting focus: underwrite classes of business where ‘underwriting matters’, as opposed to focusing
on high volume or cash-flow underwriting opportunities.
• Underwriting cycle: manage growth and profitability across the underwriting cycle.
• Market position: continue to grow as an influential and meaningful Lloyd’s market-participant in our core
classes of business, for which our underwriters have a mature business proposition.
• Distribution: continue to develop meaningful, diverse and cost-competitive distribution strategies and
channels, with renewed emphasis on making it easier and simpler for customers to access our products
and services.
• Human resources: continue to attract, develop and retain the best talent in the market, while
maintaining our inclusive, diverse and innovative culture.
• Technology: investment in technology that makes doing business easier, servicing claims faster and
increasing efficiency while reducing costs in a digitalised platform.
AWMA continues to support the Lloyd’s market modernisation initiatives and are fully engaged with Lloyd’s in its
journey towards digitalisation. We are working with Velonetic, our third party vendors and the market to ensure
our systems and processes are robust and ready to support the re-platforming of the market to a resilient, cloud-
based operational infrastructure. We are excited by future efficiency improvements and long term stability that
will come as the market transitions to this new technology.
REPORT OF THE DIRECTORS OF THE MANAGING AGENT (CONTINUED)
Allied World Managing Agency Limited 4
Syndicate 2232 | Annual Report and Accounts 2025
Review of the Business (continued)
Underwriting Result
The Syndicate reported a profit on the technical account of £78.1m (2024: £55.9m), after expenses and
investment return but before foreign exchange adjustments, and a combined ratio of 82.8% (2024: 84.4%).
Gross premium written for the year was £520.4m, an increase of £47.9m (10.1%) compared to the prior year. This
increase was mainly driven by organic growth within existing classes of business and non-rate growth through our
current and certain new delegated partnerships. Market conditions remained challenging during the year, and
underwriting discipline has been fundamental in ensuring sustainable underwriting performance. The Syndicate
continues to develop meaningful and diverse distribution strategies and channels, with an emphasis on making it
easier and simpler for customers to access the Syndicate's products and services.
The profit on the technical account of £78.1m (2024: £55.9m) and a combined ratio was 82.8% (2024: 84.4%),
benefitted from significant prior year reserve releases. Although the Syndicate was impacted by Hurricane
Melissa, the year’s largest insurance loss event in the Caribbean, the event was within our modelled range.
The prior year reserve releases of £41.7m (2024: reserve releases of £16.4m) improved the net combined ratio by
14.0% (2024: improvement of 6.0%), with releases on our Treaty Property Reinsurance, D&O and Casualty classes
of business.
The result for the financial year increased member's balances by £69.6m, this was partially offset by the profit
distribution on the closed 2022 year of account. Overall member's balances increased by £23.6m to £102.6m
(2024: increased by £37.0m to £79.0m).
Expenses
The levels of gross brokerage and commissions and other acquisition costs (which typically include overseas taxes
and levies) when expressed as a ratio of gross premium written increased to 24.5% (2024: 22.9%).
The administrative expense ratio has remained at 11.2% (2024: 11.2%). In value terms, expenses are £2.9m above
prior year and reflect higher costs in line with the growth of the business.
Member’s personal expenses include Central Fund contributions and Lloyd’s subscriptions.
Investment return
The total value of investments, cash and cash equivalents reached £720.4m by the end of the year (2024:
£621.4m) and generated an investment return of £27.3m (2024: £13.7m). The Syndicate investment portfolio
remains conservatively positioned, with a large allocation to fixed income securities. The portfolio duration is
tactically positioned with most securities maturing in the short to medium term.
Foreign exchange
The foreign exchange loss of £2.4m (2024: £0.1m gain) was driven primarily by the translation of transactional
currencies to US Dollars, the Syndicate’s functional currency.
REPORT OF THE DIRECTORS OF THE MANAGING AGENT (CONTINUED)
Allied World Managing Agency Limited 5
Syndicate 2232 | Annual Report and Accounts 2025
Review of the Business (continued)
Technical result by class
2025
Gross premium
written
£000
2025
Underwriting
profit/(loss)
£000
2024
Gross premium
written
£000
2024
Underwriting
profit/(loss)
£000
Aviation (incl Liability & Hull)
— 43 — 166
Property Direct & Facultative
22,171 6,745 14,076 3,989
Treaty Property
53,249 17,727 54,715 21,849
Treaty Casualty
31,434 8,201 27,729 8,438
Marine
27,412 12,310 24,348 5,548
Casualty (incl General, Bespoke)
82,332 24,304 77,890 25,392
Construction
37,586 100 26,750 561
Professional Lines (incl E&O, D&O)
146,501 39,556 154,181 31,533
Cyber
73,090 24,665 55,761 24,253
Portfolio Solutions
46,615 9,587 37,014 2,532
Total Syndicate
520,390 143,238 472,464 124,261
Geographic segmentation
A geographic analysis of gross premium written by territory of original insured, for insurance business and treaty
business, is shown below:
2025
£000
2024
£000
UK
142,502 97,651
EU member states
41,896 45,551
Europe excluding EU member states
5,076 6,049
United States of America
101,595 98,061
Canada
45,815 39,891
Asia Pacific
140,312 143,132
Central & South America
18,190 17,095
Middle East & Africa
25,004 25,034
Total 520,390 472,464
REPORT OF THE DIRECTORS OF THE MANAGING AGENT (CONTINUED)
Allied World Managing Agency Limited 6
Syndicate 2232 | Annual Report and Accounts 2025
Review of the Business (continued)
Principal risks and uncertainties
The principal risks and uncertainties facing the Syndicate as detailed in notes 3 and 4 to the financial statements
are as follows:
• Underwriting risk
• Reserve risk
• Reinsurance risk
• Market risk
• Price risk
• Currency risk
• Interest rate risk
• Credit risk
• Liquidity risk
• Operational risk
• Strategic risk
• Group risk
• Sustainability/Climate change risk
• Geopolitical risk
Note 4 also contains a description of the policies in place for the above risk categories, supported by an
overarching Risk Management Strategy and Governance Framework document.
Future developments
The objective is to manage our core business in order to maximise profitability through future market cycles. In
addition, AWMA seeks to develop a select number of initiatives to expand our geographic distribution and product
mix, with a continued focus on profitable growth.
Stamp capacity for the 2026 year of account has increased by 1.8% to £486.3m (2025 year of account £477.5m).
REPORT OF THE DIRECTORS OF THE MANAGING AGENT (CONTINUED)
Allied World Managing Agency Limited 7
Syndicate 2232 | Annual Report and Accounts 2025
Review of the Business (continued)
Rating Agencies
All Lloyd's Syndicates benefit from Lloyd's central resources, including the Lloyd's brand, its network of global
licences and the Central Fund. The Syndicate benefits from the following ratings held by Lloyd's: A+ (Superior) by
A.M. Best Company, AA- (Very Strong) by Standard & Poor's and AA- (Very Strong) by Fitch rating agency.
Directors
The Directors set out in the table below have held office for the whole year from 1 January 2025 to the date of this
report unless stated otherwise.
P Ford
K Graves (Independent Non-Executive)
T Hennessy (Independent Non-Executive)
S Hunter (Independent Non-Executive Chairperson)
S Liversidge (Independent Non-Executive)
E Moresco
M O'Leary
M Walsh
The Directors of AWMA are covered by a qualified third party professional indemnity provision. This has been in
place for the duration of 2025 and up to the date of this report.
Company Secretary
S Newton (Secretary)
REPORT OF THE DIRECTORS OF THE MANAGING AGENT (CONTINUED)
Allied World Managing Agency Limited 8
Syndicate 2232 | Annual Report and Accounts 2025
Review of the Business (continued)
Provision of Capital
The Syndicate is wholly aligned with a single capital provider, Allied World Capital (Europe) Limited. The capital is held
at a member level. Accordingly, all of the assets less liabilities of the Syndicate, as represented in the members
balances reported on the balance sheet on page 19, are taken into account when determining the members Lloyd’s
capital requirements.
Disclosure of Information to the Auditors
The Directors of AWMA 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 such information.
Independent Auditors
PricewaterhouseCoopers LLP ("PwC"), Chartered Accountants and Statutory Audit Firm, were appointed by the Board
as auditors, in accordance with Section 14 (2) of Schedule 1 of the Insurance Accounts Directive (Lloyd's Syndicate and
Aggregate Accounts) Regulations 2008. PwC have indicated their willingness to continue in office.
M Walsh
Managing Director
18 February 2026
REPORT OF THE DIRECTORS OF THE MANAGING AGENT (CONTINUED)
Allied World Managing Agency Limited 9
Syndicate 2232 | Annual Report and Accounts 2025
The Managing Agent is responsible for preparing the Syndicate annual report and financial statements in
accordance with applicable law and regulations.
The Insurance Accounts Directive (Lloyd’s Syndicate and Aggregate Accounts) Regulations 2008 ("the 2008
Regulations") require the Managing Agent to prepare Syndicate annual accounts for each financial year. Under the
2008 Regulations the Managing Agent has elected to prepare the financial statements in accordance with United
Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law).
Under company law the Managing Agent must not approve the financial statements 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 those Syndicate annual accounts, the Managing Agent is required to:
• Select suitable accounting policies which are applied consistently, subject to changes arising on
the adoption of new accounting standards in the year;
• Make judgements and estimates that are reasonable and prudent;
• State whether applicable accounting standards have been followed, subject to any material departures
disclosed and explained in the financial statements; and
• Prepare the annual accounts on the basis that the Syndicate will continue to write future business unless
it is inappropriate to presume the Syndicate will do so.
The Managing Agent is responsible for keeping proper accounting records which disclose with reasonable accuracy
at any time the financial position of the Syndicate and enable it to ensure that the Syndicate annual accounts
comply with the 2008 Regulations. It is also responsible for safeguarding the assets of the Syndicate and hence for
taking reasonable steps for prevention and detection of fraud and other irregularities.
The Managing Agent is responsible for the maintenance and integrity of the corporate and financial information
included on the business’s website. Legislation in the United Kingdom governing the preparation and
dissemination of annual accounts may differ from legislation in other jurisdictions.
The Managing Agent is responsible for the preparation and review of the iXBRL tagging that has been applied to
the Syndicate Accounts in accordance with the instructions issued by Lloyd’s, including designing, implementing
and maintaining systems, processes and internal controls to result in tagging that is free from material non-
compliance with the instructions issued by Lloyd’s, whether due to fraud or error.
We confirm that to the best of our knowledge the syndicate accounts, including the iXBRL tagging applied to these
accounts, comply with the requirements of the Lloyd’s Syndicate Accounts Instructions Version 3.1 as modified by
the Frequently Asked Questions Version 1.1 issued by Lloyd’s.
M Walsh
Managing Director
18 February 2026
STATEMENT OF MANAGING AGENT'S RESPONSIBILITIES
Allied World Managing Agency Limited 10
Syndicate 2232 | Annual Report and Accounts 2025
INDEPENDENT AUDITORS' REPORT TO THE MEMBER OF
SYNDICATE 2232
Report on the audit of the syndicate annual accounts
Opinion
In our opinion, Syndicate 2232’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: Balance Sheet – Assets and Balance Sheet - Liabilities as at 31 December 2025; the
Profit and Loss Account: Technical Account – General business, the Profit and Loss account: Non-technical
account, the Statement of 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 8, we have provided no non-audit services to the syndicate in the period under
audit.
Allied World Managing Agency Limited 11
Syndicate 2232 | Annual Report and Accounts 2025
INDEPENDENT AUDITORS' REPORT TO THE MEMBER OF
SYNDICATE 2232 (continued)
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.
Allied World Managing Agency Limited 12
Syndicate 2232 | Annual Report and Accounts 2025
INDEPENDENT AUDITORS' REPORT TO THE MEMBER OF
SYNDICATE 2232 (continued)
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 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 the valuation of incurred but not reported losses within claims outstanding and estimates within
gross written premium. Audit procedures performed by the engagement team included:
• Inspecting relevant meeting minutes, including those of the Board, Risk Committee and Non-Executive
Director Committee of the Managing Agent, and correspondence with regulatory authorities, including
the Council of Lloyd’s, the Prudential Regulation Authority and the Financial Conduct Authority;
• Discussions with the Board, management, risk function and internal audit function of the Managing
Agent, including consideration of known or suspected instances of fraud and/or non-compliance with
laws and regulations;
• Testing and challenging where appropriate the assumptions and judgements made by management in
their significant accounting estimates, particularly in relation to the estimation of incurred but not
reported losses within claims outstanding and estimates within gross premium written;
Allied World Managing Agency Limited 13
Syndicate 2232 | Annual Report and Accounts 2025
INDEPENDENT AUDITORS' REPORT TO THE MEMBER OF
SYNDICATE 2232 (continued)
• Identifying and testing journal entries based on risk-based criteria; and
• Designing audit procedures to incorporate unpredictability around the nature, timing and extent of our
testing.
There are inherent limitations in the audit procedures described above. We are less likely to become aware of
instances of non-compliance with laws and regulations that are not closely related to events and transactions
reflected in the syndicate annual accounts. Also, the risk of not detecting a material misstatement due to fraud is
higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for
example, forgery or intentional misrepresentations, or through collusion.
A further description of our responsibilities for the audit of the syndicate annual accounts is located on the FRC’s
website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditors’ report.
Use of this report
This report, including the opinions, has been prepared for and only for the syndicate’s 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.
Andrew Lyttle (Senior statutory auditor)
for and on behalf of PricewaterhouseCoopers LLP
Chartered Accountants and Statutory Auditors
London
18 February 2026
Allied World Managing Agency Limited 14
Syndicate 2232 | Annual Report and Accounts 2025
PROFIT AND LOSS ACCOUNT:
TECHNICAL ACCOUNT - GENERAL BUSINESS
FOR THE YEAR ENDED 31 DECEMBER 2025
Note | 2025 £000 | 2024 £000 | |
Earned premiums, net of reinsurance Premiums written: | |||
| Gross premium written | 5 | | |
| Outward reinsurance premiums | ( | ( | |
| Net premiums written | | | |
Change in the provision for unearned premiums: | |||
| Gross amount | ( | ( | |
| Reinsurers' share | | | |
| Change in the net provision for unearned premiums | ( | ( | |
| Earned premiums, net of reinsurance | | | |
Allocated investment return transferred from the non-technical account | | | |
Claims incurred, net of reinsurance | |||
Claims paid: | |||
| Gross amount | ( | ( | |
| Reinsurers' share | | ||
| Net claims paid | ( | ( | |
Change in the provision for claims: | |||
| Gross amount | ( | ( | |
| Reinsurers' share | | | |
| Net change in the net provision for claims | 7 | ( | ( |
| Claims incurred net of reinsurance | ( | ( | |
| Net operating expenses | 8 | ( | ( |
| Balance on the technical account for general business | | |
Comparative information has been represented in compliance with the Lloyd's Syndicate Accounts Instructions.
Further details has been provided within Note 1 to 20.
Allied World Managing Agency Limited 15
Syndicate 2232 | Annual Report and Accounts 2025
PROFIT AND LOSS ACCOUNT:
NON-TECHNICAL ACCOUNT
FOR THE YEAR ENDED 31 DECEMBER 2025
Note | 2025 £000 | 2024 £000 | |
| Balance on the technical account for general business | | | |
| Income from investments | | | |
| Realised (losses)/gains on investments | ( | | |
| Investment management expenses and charges | ( | ( | |
| Unrealised gains/(losses) on investments | | ( | |
| Net investment return | 11 | | |
Allocated investment return transferred to the technical account for general business | 11 | ( | ( |
| Foreign exchange (losses)/gains | ( | | |
| Profit for the financial year | | |
All operations relate to continuing activities.
The notes on pages 22 to 52 form an integral part of these financial statements.
Allied World Managing Agency Limited 16
Syndicate 2232 | Annual Report and Accounts 2025
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2025
2025
£000
2024
£000
| Income for the financial year | 75,683 | 56,000 |
Other comprehensive expense: | ||
| Currency translation differences | ( | ( |
| Total comprehensive income for the year | | |
Allied World Managing Agency Limited 17
Syndicate 2232 | Annual Report and Accounts 2025
BALANCE SHEET – ASSETS
AS AT 31 DECEMBER 2025
Note | 2025 £000 | 2024 £000 | |
Investments | |||
| Other financial investments | 12 | | |
| Deposits with ceding undertakings | | | |
| | | ||
Reinsurers' share of technical provisions | |||
| Provision for unearned premium | 7 | | |
| Claims outstanding | 7 | | |
| | | ||
Debtors | |||
| Debtors arising out of direct insurance operations | 13 | | |
| Debtors arising out of reinsurance operations | 13 | | |
| Other debtors | 13 | | |
| | | ||
Other assets | |||
| Cash at bank and in hand | | | |
| Other assets | 14 | | |
| | | ||
Prepayments and accrued income | |||
| Accrued interest and rent | | | |
| Deferred acquisition costs | 7 | | |
| | | ||
Total assets | | |
The notes on pages 22 to 52 form an integral part of these financial statements.
Allied World Managing Agency Limited 18
Syndicate 2232 | Annual Report and Accounts 2025
BALANCE SHEET – LIABILITIES
AS AT 31 DECEMBER 2025
Note | 2025 £000 | 2024 £000 | |
| Members' balance | | | |
Total capital and reserves | | | |
Technical provisions | |||
| Provision for unearned premium | 7 | | |
| Claims outstanding | 7 | | |
| | | ||
Creditors | |||
| Creditors arising out of direct insurance operations | 15 | | |
| Creditors arising out of reinsurance operations | 15 | | |
| Other creditors including taxation and social security | 15 | | |
| | | ||
| Accruals and deferred income | | | |
| Total liabilities | | | |
| Total member's balance and liabilities | | |
The notes on pages 22 to 52 form an integral part of these financial statements.
The financial statements on pages 15 to 52 were approved by the board of Directors of AWMA and were signed on
its behalf by:
M O'Leary
Finance Director
18 February 2026
Allied World Managing Agency Limited 19
Syndicate 2232 | Annual Report and Accounts 2025
STATEMENT OF CHANGES IN MEMBER'S BALANCES
FOR THE YEAR ENDED 31 DECEMBER 2025
2025 £000 | 2024 £000 | |
| Member's balance at 1 January | | |
| Profit distribution | ( | ( |
| Total comprehensive income for the year | | |
| Member's balances carried forward at 31 December | | |
Allied World Managing Agency Limited 20
Syndicate 2232 | Annual Report and Accounts 2025
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2025
2025 £000 | 2024 £000 | |
Cash flows from operating activities | ||
| Profit for the financial year | | |
Adjustments for: | ||
| Increase in gross technical provisions | | |
| Increase in reinsurers' share of gross technical provision | ( | ( |
| Increase in debtors | ( | ( |
| Increase in creditors | | |
| Movement in other assets/liabilities | ( | |
| Investment return | ( | ( |
| Foreign exchange | ( | ( |
| Net cash inflows from operating activities | | |
Cash flows from investing activities | ||
| Purchase of equity and debt instruments | ( | ( |
| Sale of equity and debt instruments | | |
| Investment income | | |
| Other | ( | ( |
| Net cash outflows from investing activities | ( | ( |
Cash flows from financing activities | ||
| Transfer to members in respect of underwriting participations | ( | ( |
| Capital contributions/open year cash calls made | ( | ( |
| Net cash outflows from financing activities | ( | ( |
| Net decrease in cash and cash equivalents | ( | ( |
| Cash and cash equivalents at 1 January | | |
| Foreign exchange on cash and cash equivalents | | ( |
| Cash and cash equivalents at 31 December | | |
Allied World Managing Agency Limited 21
Syndicate 2232 | Annual Report and Accounts 2025
1. Basis of Preparation
The Directors of Allied World Managing Agency Limited ("AWMA" or "Managing Agent"), a company incorporated
in England and Wales, present their report and annual accounts for Syndicate 2232 for the year ended 31
December 2025. The registered address of AWMA is 19th Floor, 20 Fenchurch Street, London, EC3M 3BY.
These financial statements have been prepared in accordance with the Regulation 5 of the Insurance Accounts
Directive (Lloyd’s Syndicate and Aggregate Accounts) Regulations 2008, Financial Reporting Standard 102, The
Financial Standard applicable in the UK (FRS 102) as issued in August 2014, Financial Reporting Standard 103
Insurance Contracts (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.
These financial statements have been prepared under the historical cost convention, as modified by the recognition
of certain financial assets and liabilities measured at fair value. The annual basis of accounting has been applied to
all classes of business written by the Syndicate.
Going concern
In assessing the Syndicate’s going concern position as at 31 December 2025, the Directors of AWMA have
considered all available information about the future, the possible outcomes of events and changes in conditions.
The assessment focused on the capital structure, liquidity stress test scenarios, investment risk and reinsurance
structures, along with the ongoing business considerations such as future premium flows and actual and planned
profitability targets.
The Directors of AWMA have a reasonable expectation that the Syndicate has adequate resources to continue its
business operations for at least the next 12 months from date of this report and to continue as a going concern.
Accordingly, they continue to adopt the going concern basis in preparing the financial statements.
2. Accounting Policies
The principal accounting policies are described below. These accounting policies have been applied
consistently throughout the current and preceding reporting period.
2(a) Premium written and reinsurance premium ceded
Gross written and outwards reinsurance premium comprise premium on contracts incepting during the financial
year, and adjustments on prior year contracts. Written premium are disclosed gross of commission payable to
intermediaries and exclude taxes and duties levied on premium. Outwards reinsurance premium are disclosed
gross of commissions and profit participations recoverable from reinsurers. Premium written includes estimates
for ‘pipeline’ premium. Reinstatement premium related to property catastrophe reinsurance are estimated and
accrued based upon contractual terms applied to the amount of losses expected to be paid.
2(b) Unearned premium
The provision for unearned premium comprises the proportion of gross and outwards reinsurance premium
written, which is estimated to be earned in the following or subsequent financial years, computed separately for
each insurance contract using the daily pro-rata method or established earning patterns for particular classes such
as construction.
2(c) Acquisition costs
Acquisition costs comprise all direct and indirect costs arising from the acquisition of insurance contracts. Deferred
acquisition costs represent the proportion of acquisition costs incurred which corresponds to the proportion of
gross premium written which is unearned at the balance sheet date.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
Allied World Managing Agency Limited 22
Syndicate 2232 | Annual Report and Accounts 2025
2. Accounting Policies (continued)
2(d) Expenses
The Managing Agent has charged the Syndicate for the supply of services which represents the value of services
provided under contracts to the extent that there is a right to consideration and is recorded at the value of the
consideration due. The charge is accounted for on an accrual basis and represents the costs incurred by the
Managing Agent plus 5%.
2(e) Claims provisions and related recoveries
The provision for claims and claims expenses includes estimates for unpaid claims and claims expenses on reported
losses as well as an estimate of losses incurred but not reported ("IBNR"). The provision is based upon individual
claims, case reserves and other reserve estimates reported by insureds and ceding companies as well as
management estimates of ultimate losses. Inherent in the estimates of ultimate losses are expected trends in
claims severity and frequency and other factors which could significantly vary as claims are settled. The Directors of
AWMA consider that the provisions for gross claims and related reinsurance recoveries are fairly stated on the
basis of the information currently available to them. However, ultimate losses may vary materially from the
amounts provided in the financial statements as there is inherent uncertainty in relation to the ultimate liability as
a result of subsequent information. Ultimate loss estimates are reviewed regularly and, as experience develops and
new information becomes known, the reserves are adjusted as necessary. Such adjustments, if any, are reflected in
the financial statements of operations in the period in which they become known and are accounted for as changes
in estimates.
Amounts recoverable from reinsurers are calculated in a manner consistent with the claim liability associated with
the reinsured policies. The amounts recoverable from reinsurers are recorded net of bad debt provision for
estimated uncollectable recoveries.
2(f) Unexpired risk
Provision is made for unexpired risks arising from general business where the expected value of the claims and
expenses attributable to the unexpired periods of policies in force at the balance sheet date exceeds the unearned
premium provision in relation to such policies after the deduction of any acquisition costs deferred. The provision
for unexpired risks is calculated separately by classes of business, after taking into account the relevant investment
return.
2(g) Investments
Investments are carried at their current fair market value as shown in note 12.
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction
between market participants at the measurement date. The fair value of financial assets and liabilities traded in
active markets is based on quoted market bid and ask price for both financial assets and financial liabilities
respectively.
The fair value of financial assets and liabilities that are not traded in an active market is determined by observable
inputs such as quoted prices for similar financial instruments exchanged in active markets, quoted prices for
identical or similar financial instruments exchanged in active markets and other market observable inputs. Where
there are only unobservable inputs used in the measurement of financial instruments, management is required to
use its own assumptions and valuation techniques.
Gains and losses on investments designated as fair value are recognised through the profit and loss account.
Interest income from investments in bonds and short-term investments is recognised at the effective interest rate.
2(h) Investment return
Investment return comprises income received and receivable on fixed income securities, interest earned and
accrued on cash, realised gains on disposal of investments and unrealised gains or losses on investments held.
All investment return is initially recognised in the non-technical account. It is then transferred to the technical
account as it all relates to funds supporting underwriting business.
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
Allied World Managing Agency Limited 23
Syndicate 2232 | Annual Report and Accounts 2025
2. Accounting Policies (continued)
2(i) Reporting currency
The functional currency of the Syndicate is United States dollars ($), as it is the currency of the primary economic
environment. The presentational currency is United Kingdom pound sterling (£) as it is market practice to present
the Syndicate report and accounts in the functional currency of the Lloyd’s market aggregated accounts.
2(j) Foreign Exchange
Monetary assets and liabilities denominated in foreign currencies are translated at the exchange rates ruling at the
balance sheet date. Revenues and costs are translated at the exchange rates ruling at the dates of the
transactions. Profits and losses arising from foreign currency translation and on settlement of amounts receivable
and payable in foreign currencies are dealt with through the profit and loss account. Profits and losses arising from
the translation from functional to presentational currency are dealt with through the statement of other
comprehensive income.
2(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 the member 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 are included in the balance
sheet under the heading ‘other debtors’. No provision has been made for any overseas tax payable by members on
underwriting results.
2(l) Bad debts
Provision is made for bad debts on overdue receivables or where specific information is available to suggest a
debtor may be unable or unwilling to settle its debt to the Syndicate.
2(m) Reinsurers' commissions and profit participations
Reinsurers' commissions and profit participations, which include reinsurance profit commission and overriders,
have been treated as a contribution to expenses, rather than as a premium adjustment.
2(n) Deposits with ceding undertakings
Deposits with ceding undertakings are measured at cost less allowance for impairment.
2(o) Critical accounting estimates and judgments and key sources of uncertainty
In preparing these financial statements and in the application of the Syndicate’s accounting policies, which are
described above, the Directors of AWMA are required to make critical accounting estimates, judgments and
assumptions that affect the application of the Syndicate's accounting policies and the reported amounts of assets,
liabilities and expenses. The estimates, judgements and associated assumptions are based on historical experience
and other factors that are considered to be relevant. Actual results may differ from these estimates. Estimates and
underlying assumptions are reviewed on an ongoing basis. Revisions to estimates are recognised prospectively.
The key area of uncertainty which requires the use of accounting estimates and judgments are listed as follows:
Claims provisions
The most critical estimate included within the syndicate’s balance sheet is the estimate for insurance losses
incurred but not reported ("IBNR") which is included within gross technical provisions and reinsurers' share of
technical provisions in the balance sheet. This estimate is significant as it outlines the current liability for potential
future incurred claims. The technical provisions estimates as at 31 December 2025 are included within claims
outstanding in the balance sheet and are separately disclosed in note 7.
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
Allied World Managing Agency Limited 24
Syndicate 2232 | Annual Report and Accounts 2025
2. Accounting Policies (continued)
2(o) Critical accounting estimates and judgments and key sources of uncertainty (continued)
Claims provisions (continued)
The reserve for IBNR losses and loss expenses relate primarily to unreported events that, based on industry
information, management’s experience and actuarial evaluation, can reasonably be expected to have occurred and
are reasonably likely to result in a loss to the Syndicate. IBNR reserves also relate to estimated development of
reported events that, based on industry information, management’s experience and actuarial evaluation, can
reasonably be expected to reach the Syndicate’s attachment point and are reasonably likely to result in a loss. As a
result, reserves for losses and loss expenses include significant estimates for IBNR reserves.
The Syndicate factors into IBNR reserves economic inflation by assuming an inflation rate consistent with historical
and current trends. The IBNR reserves are calculated as the ultimate amount of losses and loss expenses less
cumulative paid losses and loss expenses and outstanding losses. The Syndicate’s actuaries employ generally
accepted actuarial methodologies to determine estimated ultimate loss reserves.
The Syndicate believes that its current estimates of liabilities appropriately reflect its current knowledge of the
business and the prevailing market, social, legal and economic conditions while giving due consideration to
historical trends and volatility evidenced in the liabilities over the longer term. Although management believes that
the IBNR reserves are sufficient to cover losses, there can be no assurance that losses will not deviate from the
Syndicate’s reserves, possibly by material amounts.
In general, the methods and related assumptions used for estimating the reserve for losses and loss expenses,
including IBNR, are predicated on whether the line of business falls into one of the following two categories:
short-tail line or long-tail line.
In short-tail lines of business, claims are generally reported and paid within a relatively short period of time during
and following the policy coverage period. This generally enables the Syndicate to determine with greater certainty
the estimate of ultimate losses and loss expenses.
In long-tail lines of business, claims may be reported or settled several years after the coverage period has
terminated, which increases uncertainties of the reserve estimates in such lines. Due to the lengthy reporting
pattern of these lines, reliance is placed on industry benchmarks supplemented by the Syndicate’s own experience.
For expected loss ratio selections, the Syndicate considers its existing experience supplemented with analysis of
loss trends, rate changes and experience of peers.
The Syndicate utilises a variety of standard actuarial methods in its analysis. The selections from these various
methods are based on the loss development characteristics of the specific line of business. The actuarial methods
utilised by the Syndicate include Paid Loss Development Method, Reported Loss Development Method, Expected
Loss Ratio Method, Bornhuetter-Ferguson Paid Loss Method, and Bornhuetter-Ferguson Reported Loss Method.
The estimates and judgements are applied in line with the overall reserving philosophy and seek to state the claims
provisions on a undiscounted best estimate basis. An actuarial prudence margin is also applied over and above the
actuarial best estimate to allow for the inherent uncertainty within the best estimate reserve position.
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
Allied World Managing Agency Limited 25
Syndicate 2232 | Annual Report and Accounts 2025
2. Accounting Policies (continued)
2(o) Critical accounting estimates and judgments and key sources of uncertainty (continued)
Premiums written
Premiums written includes estimates for premiums due but not yet received or notified, also defined as business
that has an attachment date prior to the end of the reporting period but which has not yet been processed into the
systems utilised by the Syndicate.
For inward treaty reinsurance business, key premium estimates of recognising premium over the life of the contract
are made. The premium written is initially based on the estimated premium income (“EPI”) of each inward
reinsurance treaty. The EPI is pro-rated across the treaty period on a straight-line basis unless the underlying
writing pattern from the prior period indicates the actual underlying writing pattern is materially different.
Management adjust the EPI estimates as the treaty level as each contract matures. At a total segment level this is
considered to provide a reasonable estimate of premium income for the full year.
For delegated authority business, management estimate premiums due but not yet received for each arrangement
based on historic information and current market conditions. The estimate is assessed for reasonableness after the
financial year-end with the resulting variation historically not being significant.
The premium debtors receivable held at 31 December 2025 is disclosed in note 13 of these accounts.
3. Capital and Risk Management
Capital Management
In order to meet the Society of Lloyd’s requirements, the Syndicate is required to calculate its solvency capital
requirements (“SCR”) for the prospective underwriting year. The SCR for the Syndicate is based on the modelled
output of the economic capital model ("ECM"). This amount must be sufficient to cover a "1-in-200" year loss,
reflecting uncertainty in the ultimate run-off of underwriting liabilities. Lloyd’s applies a 35% capital uplift to the
members’ capital requirement, known as the Economic Capital Assessment (“ECA”). The purpose of this uplift,
which is a Lloyd’s requirement and not a Solvency UK requirement, is to meet Lloyd’s financial strength, licence and
ratings objectives.
The ECM is also used for internal reporting and outputs are provided to the Board of Directors of AWMA and its
committees. ECM outputs are included in the Syndicate’s Own Risk Solvency Assessment ("ORSA") report, which
will be submitted to Lloyd’s on or before 31 March 2026.
Although Lloyd’s capital setting processes use a capital requirement set at Syndicate level, the requirement to meet
Solvency UK and Lloyd’s capital requirements apply at member level only. Accordingly the capital requirement in
respect of the Syndicate is not disclosed in these financial statements. The level of FAL which supports the
Syndicate’s underwriting activities and member's deficit is disclosed in note 18.
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
Allied World Managing Agency Limited 26
Syndicate 2232 | Annual Report and Accounts 2025
3. Capital and Risk Management (continued)
Insurance Risk Management
Insurance risk is defined as the risk of fluctuations in benefits payable to policyholders including underwriting risk
(which covers catastrophe and non-cat risk), reserve risk and reinsurance risk. Thus it includes the risk of loss
arising from prospective underwriting and the development of prior years and also encompasses risks associated
with potential for increased operating expenses.
The elements of insurance risk (underwriting, reserving and outwards reinsurance) are mutually dependent. They
are described as follows:
a) Underwriting Risk (Premium Risk)
This is split into two parts - (i) The risk that actual losses and expenses on a future underwriting year are greater
than the expected losses and expenses and (ii) The risk that actual losses and expenses on unearned incepted
business, which is associated with future premium for policies previously written, will differ from the expected
losses and expenses.
This is further divided into both catastrophe risk and non-catastrophe elements. Catastrophe risk is the risk that a
single event (or series of events) of major magnitude, usually over a short period of time, leads to a significant
deviation in actual claims from the total expected claims.
b) Reserve Risk
This is the risk that actual reserves and expenses, associated with policies previously written and earned, will differ
from the best estimate expected reserves or prove to be inadequate relative to the technical provisions.
c) Reinsurance Risk
Reinsurance risk is defined as the inability to obtain reinsurance coverage at the appropriate time for a reasonable
cost. The assessment of reinsurance risk relates to risks arising from mismatch, dispute and exhaustion.
Stress Testing and Sensitivity Analysis
Stress testing is an important risk management tool utilised by AWMA as part of its internal risk management and is
also a key part of the Own Risk and Solvency Assessment ("ORSA") process. Stress testing provides management
with information on adverse unexpected outcomes related to a variety of risks and provides an idea of relative
importance and impetus for management action as necessary. Moreover, stress testing is a tool that supplements
other risk management approaches and measures such as risk profile monitoring and exposure management.
Stress testing covers the following categories:
a) Scenario Tests - assessing the financial impact on the business of possible future scenarios, e.g, a large
catastrophic event or multiple events
b) Sensitivity Tests - assessing the implication of possible alternative assumptions, e.g, variations in premium
income and in particular their impact on capital requirements
c) Reverse Stress Tests - Assessing the impact and management actions for scenarios where the Syndicate has
become insolvent.
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
Allied World Managing Agency Limited 27
Syndicate 2232 | Annual Report and Accounts 2025
3. Capital and Risk Management (continued)
Stress Testing and Sensitivity Analysis (continued)
Insurance Risk - Scenario tests
The Syndicate runs several insurance risk scenario tests to assess the financial impact of possible future scenarios.
The following are some of the scenarios considered:
• The cost impact assuming the Syndicate experiences the same level of natural catastrophe activity as in
the worst historic natural catastrophe years
• The impact of non-natural catastrophe losses. The financial impact on the Syndicate of disaster scenarios,
including Lloyd's defined realistic disaster scenarios are assessed
• The impact of natural catastrophe losses. The financial impact on the Syndicate of disaster scenarios,
including Lloyd's defined realistic disaster scenarios, are assessed
• The effects of severe weather event industry loss
• The impact of climate change scenarios leading to severe physical risks
• Reserve understatement. These tests may cover certain correlating classes, e.g, all Casualty classes
• The effect of a protracted increased inflationary environment, which assumes that inflation rates would
be higher than the current market expectation levels for a longer period
Insurance Risk - Sensitivity Analysis
• Mis-pricing of risks / incorrect loss ratio assumptions. A 5% deviation in loss ratios may be postulated,
either upwards or downwards
• The tolerance for variations in expenses, including indirect costs, such as overheads
• Errors in Catastrophe PML calculations
The following table presents the profit and loss impact of the sensitivity of the value of insurance liabilities
disclosed in the accounts. The amount disclosed in the table represents the profit or loss impact of an increase or
decrease in the gross and net claims outstanding as a result of applying the sensitivity. The amount disclosed for
the impact on claims outstanding – net of reinsurance represents the impact on both the profit and loss for the
year and member balance.
Claims outstanding
| Gross of reinsurance | Net of reinsurance | |||
| 2025 | 2024 | 2025 | 2024 | |
| 5% Sensitivity | £000 | £000 | £000 | £000 |
| Increase | ||||
| Decrease | ( | ( | ( | ( |
Concentrations of Insurance Risk
Concentrations of risk can occur through a number of sources, including but not limited to:
• Natural catastrophe.
• Non-natural catastrophe.
• Territorial exposures.
• Outwards reinsurance counterparties.
• Broker balances or over-reliance on one brokerage firm/source of business.
• Asset holdings by currency, class or counter-party.
• High dependence across risk categories.
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
Allied World Managing Agency Limited 28
Syndicate 2232 | Annual Report and Accounts 2025
3. Capital and Risk Management (continued)
Concentrations of Insurance Risk (continued)
The ECM as employed by AWMA captures all elements of concentration risk, most notably the potential for a clash
between categories of risk. Diversification effects are also allowed for. Capital model outputs are reported on a
quarterly basis to the Board and management committees.
Natural and Non-natural Catastrophe exposure are the key areas of concentration risk within the broader
insurance risk definition. This exposure is captured via the exposure management process, which enables the
calculation of probable maximum Loss (PMLs) and realistic disaster scenarios (RDSs).
With regards to natural catastrophe risks, key region peril exposures are identified and underlying risk data
utilised to determine probabilistic loss potential. External natural catastrophe models are used for pricing and
probabilistic loss aggregation to determine gross and net of outwards reinsurance loss potential, by region and by
peril. Deterministic scenario testing is also used to measure natural catastrophe risk, including Lloyd’s Realistic
Disaster Scenarios.
With regards to non-natural catastrophe risks, key Cyber exposures are identified and underlying risk data utilised
to determine probabilistic loss potential. An external Cyber catastrophe model is used for probabilistic loss
aggregation to determine gross and net of outwards reinsurance loss potential. Deterministic scenario testing is
also used to measure Cyber, Liability and other non-natural catastrophe risks, including Lloyd’s Realistic Disaster
Scenarios.
Results are presented on a quarterly basis to the Board and management committees.
The above criteria has resulted in 15 classes of business (for the 2025 Year of Account) which have concentrations
or pools of risks that have common characteristics and are similar in nature.
COB Code Class of Business
COB10
Property Direct & Facultative
COB30
Treaty Casualty
COB40
Errors & Omissions
COB50
Directors & Officers
COB60
General Casualty
COB80
Treaty Property - CAT
COB90
Treaty Property - Non CAT
COB100
Marine
COB150
Onshore Construction
COB170
Bespoke
COB180
Cyber
COB190
ICX
COB200
Programs
COB210
Portfolio Solutions
COB220
Gemini
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
Allied World Managing Agency Limited 29
Syndicate 2232 | Annual Report and Accounts 2025
3. Capital and Risk Management (continued)
Insurance Risk Mitigation
Risk mitigation techniques are used to reduce the impacts of adverse effects and threats on AWMA but also to
enhance opportunities. The following are the main types of risk mitigation used in AWMA:
Risk Transfer:
• Outwards reinsurance: There is cover in place to protect AWMA from concentrations of risk (e.g.
catastrophe loss), single large events and volatility in results. Strict controls are applied in terms of
security ratings of all approved reinsurers.
Risk Acceptance:
• The AWMA strategy is to employ a prudent approach to underwriting and risk selection.
• A business plan is set and adherence to this is monitored.
• Capital modelling processes (economic capital model) are used to ensure that AWMA has sufficient
capital resources to support its insurance risks.
Risk Limitation:
• Catastrophe probable maximum losses (‘PMLs’) are limited by defined capital tolerance levels at the 1 in
250 year event.
• There are geographical/regional limits in place by line of business to limit concentration risk.
• Underwriters have set line size limitations.
• Maximum concentration limits for third parties are in place
Risk Avoidance:
• AWMA writes business only within its risk appetites.
4. Financial Risk Management
The Syndicate's financial instruments include investments in securities at fair value through profit and loss, other
receivables, cash and cash equivalents, other payables, accruals and liabilities. The risks associated with these
financial instruments include market risk (currency risk, inflation risk, interest rate risk and price risk), credit risk
and liquidity risk. The Syndicate also has insurance-related assets and liabilities which have similar financial risks.
The policies on how to mitigate these risks are set out below. Management monitors these exposures to ensure
appropriate measures are implemented in a timely and effective manner.
Market risk
Price risk, currency risk, interest rate risk, credit risk and liquidity risk are all grouped under market risk which is
defined as the risk arising from fluctuations in values of, or income from, invested assets including fluctuations
due to movements in interest rates, foreign exchange rates, credit spreads or credit defaults.
Price risk
The Syndicate is exposed to price risk arising from fluctuations in the value of financial instruments as a result of
changes in the market prices and the risks inherent in all investments. The Syndicate has no significant
concentration of price risk. The risk is managed by the Syndicate by maintaining an appropriate mix of low-risk
debt securities and other fixed income securities.
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
Allied World Managing Agency Limited 30
Syndicate 2232 | Annual Report and Accounts 2025
4. Financial Risk Management (continued)
Currency risk
The Syndicate's exposure to currency risk arises primarily from the currency mismatch in assets and liabilities
primarily driven by insurance debtors and insurance creditors denominated in currencies other than the functional
currency. Management monitors foreign exchange exposure and will consider hedging significant foreign currency
exposure when the need arises.
Carrying amounts of the Syndicate's material foreign currency denominated assets and liabilities are shown below,
this excludes members balances:
2025 | GBP £000 | USD £000 | EUR £000 | CAD £000 | AUD £000 | OTH £000 | Total £000 |
| Financial investments | | | | | | | |
Reinsurer's share of technical provisions | | | | | | | |
Insurance and reinsurance receivables | | | | | | | |
| Other assets | | | | | | | |
| Prepayments and accrued income | | | | | | | |
| Total assets | | | | | | | |
| Technical provisions | ( | ( | ( | ( | ( | | ( |
Insurance and reinsurance payables | ( | ( | ( | ( | ( | | ( |
| Accruals and deferred income | ( | ( | ( | ( | ( | | ( |
| Total liabilities | ( | ( | ( | | ( | ||
| Total capital and reserves | | ( | ( | ( | ( | ( | ( |
2024 | GBP £000 | USD £000 | EUR £000 | CAD £000 | AUD £000 | OTH £000 | As Restated Total £000 |
| Financial investments | | | | | | ||
Reinsurer's share of technical provisions | | | | | | | |
Insurance and reinsurance receivables | | | | | | | |
| Other assets | | | | | | ||
| Prepayments and accrued income | | | | | | | |
| Total assets | | | | ||||
| Technical provisions | ( | ( | ( | | ( | ||
| Insurance and reinsurance payables | ( | ( | ( | ( | | ( | |
| Accruals and deferred income | ( | ( | ( | ( | ( | | ( |
| Total liabilities | ( | ( | ( | | ( | ||
| Total capital and reserves | | ( | ( | ( | | ( | ( |
Restatement of prior period
During the year management identified a misclassification of balances between insurance and reinsurance
payables and accruals and deferred income which was reported within the currency risk table above.
Comparative figures in these financial statements have been restated accordingly.
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
Allied World Managing Agency Limited 31
Syndicate 2232 | Annual Report and Accounts 2025
4. Financial Risk Management (continued)
Currency risk (continued)
Sensitivity to changes in foreign exchange rates
The table below gives an indication of the impact on result of a percentage movement in the relative strength of
US dollars, the functional currency of the Syndicate, against the value of all other currencies including the
Syndicate's major currencies, Sterling, Canadian dollar, Euro and Australian dollar simultaneously. The analysis is
based on the information at 31 December of each year end:
Impact on result for the
financial year and net assets
US dollar weakens
2025
£000
2024
£000
10% against other currencies (4,335) (49)
20% against other currencies (8,669) (97)
US dollar strengthens
10% against other currencies 4,335 49
20% against other currencies 8,669 97
Interest rate risk
The fixed income securities in the Syndicate's investment portfolio are subject to interest rate risk. Any changes in
interest rates have a direct effect on the market values of fixed income securities. As interest rates rise, the market
values fall and vice versa.
The sensitivity of the results and net assets to changes to the investment yields is set out in the table below. This
represents management's assessment of the reasonably possible change in interest rates over the next year.
Impact on result for the
financial year and net assets
2025
£000
2024
£000
Impact of 50 basis point increase on net results and net assets (3,569 ) (3,068 )
Impact of 50 basis point decrease on net results and net assets 3,569 3,068
Impact of 100 basis point increase on net results and net assets (7,137) (6,137)
Impact of 100 basis point decrease on net results and net assets 7,137 6,137
The Syndicate's method for assessing interest rate fluctuations has not changed significantly over the financial
year.
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
Allied World Managing Agency Limited 32
Syndicate 2232 | Annual Report and Accounts 2025
4. Financial Risk Management (continued)
Credit risk
Credit risk arises out of the failure of a counter-party to perform according to the terms of the contract. The
Syndicate's major areas of credit risk are in relation to its investment portfolio, its reinsurance program and the
amounts due from policyholders and intermediaries.
The Syndicate's investment portfolio is managed pursuant to guidelines that follow the prudent person principles.
The guidelines limit the allowable holdings of a single issue and issuer. The Syndicate believes that there are no
significant concentrations of credit risk associated with its investment portfolio.
The Syndicate purchases reinsurance in order to limit its maximum loss, to protect against concentration of risk
within the portfolio and to manage exposure to catastrophic events. Because the ceding of insurance does not
discharge the Syndicate from its primary obligation to the insureds, the Syndicate remains liable to the extent that
its reinsurers do not meet their obligations under the reinsurance agreements. Therefore, the Syndicate
evaluates the financial condition of its reinsurers and monitors concentration of credit risk. No material provision
has been made for unrecoverable reinsurance as of 31 December 2025 as the Syndicate believes that reinsurance
balances will be recovered.
Insurance balances receivable primarily consist of net premium due from insureds and reinsureds. The Syndicate
believes that the counterparties to these receivables are able to meet, and will meet, all of their obligations. The
Syndicate's credit risk is further reduced by the contractual right to offset loss obligations or unearned premium
against premium receivable or to cancel policies as per the cancellation clause in all policies for non-payment.
Consequently, the Syndicate has not included any material provision for unrecoverable accounts receivable.
The following table shows aggregated credit risk exposure for assets by credit rating:
| 2025 | AAA | AA | A | BBB or less | Not rated | Total |
| £000 | £000 | £000 | £000 | £000 | £000 | |
| Shares and other variable yield securities | | | | | | |
Debt securities and other fixed income securities | | | | | | |
| Reinsurer' share of claims outstanding | | | | | | |
| Syndicate loans to central fund | | | | | | |
| Deposits with ceding undertakings | | | | | | |
| Other investments | | | | | | |
| Cash at bank and in hand | | | | | | |
| Debtors arising out of direct insurance operations | | | | | | |
| Debtors arising out of reinsurance operations | | | | | | |
| Other debtors and accrued interest | | | | | | |
Total credit risk | | | | | |
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
Allied World Managing Agency Limited 33
Syndicate 2232 | Annual Report and Accounts 2025
4. Financial Risk Management (continued)
Credit risk (continued)
| 2024 | AAA | AA | A | BBB or less | Not rated | Total |
| £000 | £000 | £000 | £000 | £000 | £000 | |
| Shares and other variable yield securities | | | | | | |
| Debt securities and other fixed income securities | | | | | | |
| Reinsurer' share of claims outstanding | | | | | | |
| Syndicate loans to central fund | | | | | | |
| Deposits with ceding undertakings | | | | | | |
| Other investments | | | | | | |
| Cash at bank and in hand | | | | | | |
| Debtors arising out of direct insurance operations | | | | | | |
| Debtors arising out of reinsurance operations | | | | | | |
| Other debtors and accrued interest | | | | | | |
| Total credit risk | | | | | |
Representation of prior period
The above credit risk exposure for assets by credit rating table for prior year has been represented to be compliant
with the Lloyd’s Syndicate Accounts Instructions Version 3.1.
The following table shows the carrying value of assets that are neither past due nor impaired, the ageing of assets
that are past due but not impaired and assets that have been impaired. The factors considered in determining the
value of the impaired assets were: analysis of impairment, ageing of balances, past loss experience, current
economic conditions and other relevant circumstances.
2025 | Neither due nor impaired | Past due less than 90 days | Past due 91 to 180 days | Past due 181 to 365 days | Past due more than 365 days | Total past due nor impaired | Total |
| £000 | £000 | £000 | £000 | £000 | £000 | £000 | |
Shares and other variable yield securities | | | | | | | |
Debt securities and other fixed income securities | | | | | | | |
Other investments | 42,655 | | | | | | 42,655 |
| Deposits with ceding undertakings | | | | | | | |
Reinsurer' share of claims outstanding | | | | | | | |
| Syndicate loans to central fund | | | | | | | |
Debtors arising out of direct insurance operations | | | | | | | |
Debtors arising out of reinsurance operations | | | | | | | |
Cash at bank and in hand | | | | | | | |
Other debtors | | | | | | | |
Total credit risk | | | | | |
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
Allied World Managing Agency Limited 34
Syndicate 2232 | Annual Report and Accounts 2025
4. Financial Risk Management (continued)
Credit risk (continued)
2024 | Neither due nor impaired | Past due less than 90 days | Past due 91 to 180 days | Past due 181 to 365 days | Past due more than 365 days | Total past due nor impaired | Total |
| £000 | £000 | £000 | £000 | £000 | £000 | £000 | |
Shares and other variable yield securities | | | | | | | |
Debt securities and other fixed income securities | | | | | | | |
Other investments | 37,863 | | | | | | 37,863 |
| Deposits with ceding undertakings | | | | | | | |
Reinsurer' share of claims outstanding | | | | | | | |
| Syndicate loans to central fund | | | | | | | |
Debtors arising out of direct insurance operations | | | | | | | |
Debtors arising out of reinsurance operations | | | | | | | |
Cash at bank and in hand | | | | | | | |
Other debtors | | | | | | | |
Total credit risk | | | | | |
Liquidity risk
The Syndicate follows a prudent person principle investment strategy. The strategy is designed to emphasise the
preservation of invested assets, and provide adequate liquidity for the prompt payment of claims as well as
attractive returns for the member.
To help ensure adequate liquidity for the payment of claims, the Syndicate takes into account the maturity and
duration of its investment portfolio and its liability profile. In setting investment guidelines, the Syndicate considers
the impact of various catastrophic events to which the Syndicate may be exposed. The majority of its assets are
invested in the fixed income markets. There are restrictions on the maximum amount of its investment portfolio
that may be invested in alternative investments (such as hedge funds and private equity vehicles) as well as a
minimum amount that must be maintained in investment grade fixed income securities and cash. There are also
restrictions on the portfolio's composition, including limits on the type of issuer, sector limits, credit quality limits,
portfolio duration, limits on the amount of investments in approved countries and permissible security types.
For several asset classes the Syndicate has engaged outside investment managers to provide certain discretionary
investment management services. AWMA has agreed to pay investment management fees based on the market
values of the investments in the portfolio. The fees, which vary depending on the amount of assets under
management, are included as a deduction to net investment income. These investment management agreements
may generally be terminated by either party upon 30 days prior written notice.
The Syndicate has also developed investment guidelines that include restrictions on the permissible security types
the investment managers may include in the portfolios that they manage. The Syndicate may direct its investment
managers to invest some of the investment portfolio in currencies other than US dollar based on the business the
Syndicate has written, the currency in which our loss reserves are denominated on our books or regulatory
requirements.
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
Allied World Managing Agency Limited 35
Syndicate 2232 | Annual Report and Accounts 2025
4. Financial Risk Management (continued)
Liquidity risk (continued)
The following table summarises the maturity profile of the Syndicate’s financial liabilities based on remaining
undiscounted contractual obligations, including outstanding claim liabilities and other creditors. The outstanding
claim liabilities are based on the estimated timing of claim payments resulting from recognised claim liabilities.
2025
No
stated
maturity 0-1 year
1-3
years
3-5
years >5 years Total
£000 £000 £000 £000 £000 £000
Claims outstanding
Creditors
Total
2024 | No stated maturity | 0-1 year | 1-3 years | 3-5 years | >5 years | Total |
| £000 | £000 | £000 | £000 | £000 | £000 | |
Claims outstanding | | | | | | |
Creditors | | | | | | |
Total | | | | | | |
Operational risk
Operational risk is the loss resulting from inadequate or failed internal processes, people and systems. It also
includes legal risks that arise from failure to comply with relevant laws or regulations, risks arising from inadequate
contingency plans as addressed in the Syndicate's business continuity plans and the risks arising from the inability
to respond and adapt to operational disruptions leading to harm being caused to customers.
AWMA has developed and implemented a risk register and risk governance system to ensure effective risk
management of operational risk is carried out. Management receives regular operational risk updates and the
Board of Directors oversees the risk framework.
AWMA has developed and implemented an operational resilience framework, which is overseen by the Board of
Directors.
AWMA has entered into a number of outsourcing arrangements in accordance with outsourcing policies and
procedures, the risks and performance of that are monitored by management.
The Syndicate relies on information technology in virtually all aspects of its business. A significant disruption or
failure of the Syndicate's information technology could result in loss of assets and critical information, potential
breach of privacy laws, expose the Syndicate to remediation costs and reputational damage, and adversely affect
the Syndicate's results of operations, financial condition and liquidity. Cyber-attacks could further adversely affect
the Syndicate's ability to operate facilities, information technology and business systems, or compromise
confidential customer and employee information. Cyber-attacks resulting in political, economic, social or financial
market instability or damage to or interference with the Syndicate's assets, or its customers or suppliers may result
in business interruptions, lost revenue, higher commodity prices, disruption in fuel supplies, lower energy
consumption, unstable markets, increased security and repair or other costs, any of which may affect the
Syndicate's consolidated financial results.
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
Allied World Managing Agency Limited 36
Syndicate 2232 | Annual Report and Accounts 2025
4. Financial Risk Management (continued)
Operational risk (continued)
The Syndicate has taken steps intended to mitigate these risks, including implementation of cyber security and
cyber resilience measures, business continuity planning, disaster recovery planning and business impact analysis,
and regularly updates these plans and security measures, however, there can be no assurance that such steps will
be adequate to protect the Syndicate from the impacts of a cyber attack.
It is critical for AWMA that the key resources required to support its underwriting and other essential business
activities continue to be available. A number of contingency plans are in place to mitigate any loss of key resources
from disrupting the ongoing operations of the Syndicate and AWMA.
The Syndicate is required to comply with the requirements of a number of regulators including the Financial
Conduct Authority ("FCA"), the Prudential Regulation Authority ("PRA"), the Monetary Authority Singapore
("MAS"), the Office of the Superintendent of Financial Institutions ("OFSI"), the Australian Prudential Regulation
Authority ("APRA") and Lloyd’s. Lloyd’s requirements include those imposed on the Lloyd’s market by overseas
regulators, particularly in respect of US situs business.
Strategic risk
This relates to the risk of not achieving the Syndicate's short and long term objectives due to any inability to
implement appropriate business plans and strategies, make decisions (especially in the context of risk mitigation),
allocate capital or resources, or adapt to changes in the business environment. AWMA manages this risk through
the regular measuring, monitoring and reporting of established risk appetite metrics to AWMA’s Board Risk
Committee.
Group risk
Group risk refers to the potential impact of risk events, of any nature, arising in or from membership of a corporate
group. Potential negative impacts on the activities of the Syndicate by Allied World Assurance Company Holdings,
Ltd, and its subsidiaries (collectively, the "Group").
Sustainability and climate change risk
Climate-related risks and opportunities have increased in recent years and understanding and managing climate
change risk is of fundamental importance to the business. Climate change exposes AWMA to a range of risks which
can be grouped into three main categories:
Physical damage
Physical damage climate change risks may arise from increased frequency and/or severity of climate related events
beyond anticipated. Physical risks may challenge our ability to effectively underwrite, model and price catastrophe
risk particularly if the frequency and severity of catastrophic events such as hurricanes, tornadoes, floods, wildfires
and windstorms and other natural disasters may be exacerbated globally.
Allied World review and assess their view of catastrophe risk based on the latest catastrophe models and
aggregate exposures and use the output of the analysis within their pricing models to minimise the risk of losses
being greater than anticipated.
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
Allied World Managing Agency Limited 37
Syndicate 2232 | Annual Report and Accounts 2025
4. Financial Risk Management (continued)
Sustainability and climate change risk (continued)
Transitional risk
Transitional risks may arise from the effort to transition towards a lower-carbon economy, such as changes in
government policy, technology changes, reputational risks, changes in consumer demand and updating of global
infrastructure which may lead to a reduction in the value of certain assets.
Asset volatility may increase if assets are invested with a short-term view not having taken into consideration the
potential longer-term climate change related impacts. AWMA have minimised this risk by taking a longer-term
view when investing in assets and thus currently have no assets invested in fossil fuel mining or producers or major
users of fossil fuels such as air or shipping transportation, chemical manufacturers etc. and thus this risk is
considered to be low. AWMA will continue to monitor this risk as it develops however it is currently a low risk to
the portfolio.
Liability risk
Liability risks are risks that arise from third parties seeking compensation from the effects of climate change, such
as companies being litigated against due to the impact of their greenhouse emissions. The Syndicate reviews its
portfolio composition and where a liability or reputational risk is expected to emerge underwriting actions are
taken to reduce or mitigate this risk.
Climate change presents risk of financial loss to AWMA. For example, losses resulting from actual policy experience
may be adverse as compared to the assumptions made in product pricing and our ability to mitigate our exposure
may be reduced. Climate change-related risks may also adversely impact the value of the securities that we hold or
lead to increased credit risk of other counterparties we transact business with, including reinsurers.
AWMA has a climate change strategy which outlines the Syndicate’s climate change ambition and a governance
structure is in place to support the monitoring of climate change developments and potential impact of climate
change on the business. AWMA utilizes the governance framework to drive enhanced decision making relating to
climate change. Additionally, AWMA has explored the resilience and vulnerabilities of the business model, through
modelling of a range of climate change scenarios within the ORSA, to inform strategic planning. AWMA continues
to develop its climate change risk modelling capabilities, however, we cannot predict the long-term impacts of
climate change on our business and results of operations.
Geopolitical risk
The geopolitical environment in 2025 has remained highly uncertain, with ongoing conflicts and heightened global
tensions, which present potential challenges to underwriting performance and operational resilience. The
continuing war in Ukraine, instability in the Middle East including the armed conflict between Hamas-led
Palestinian militant groups and Israeli military forces, and rising tensions involving Iran have contributed to
volatility in energy markets, supply chains, and economic activity. These conditions create uncertainty that may
influence premium adequacy, claims frequency, and overall profitability.
While tariffs and trade restrictions remain a factor in certain sectors, the more significant impact stems from
geopolitical instability, which can disrupt financial markets and investment returns. A review of the Syndicate’s
exposure to the above conflicts was conducted. The results indicate that the Syndicate has limited exposure to
claims directly arising from the conflicts. However, as these are ongoing events it is difficult to predict the longer-
term impact on the wider global geo-political landscape and hence the potential adverse impact on our business
and results of operations over time.
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
Allied World Managing Agency Limited 38
Syndicate 2232 | Annual Report and Accounts 2025
4. Financial Risk Management (continued)
Policies and processes
Policies specific to the Syndicate are in place for all of the above risk categories, under the auspices of an
overarching Risk Management Strategy and Governance Framework document. These documents are reviewed by
the Board on an annual basis, with the responsibility delegated on an operational basis to the risk management
function under the leadership of the Chief Risk Officer.
In addressing all risk types the Syndicate aims to ensure that:
• All significant risks are identified, measured, assessed, managed and monitored in a consistent and
effective manner;
• Appropriate and reliable risk management tools are deployed to support risk management, particularly
management reporting, decision making and capital assessment;
• All Directors, management and staff are accountable for managing risk in line with the roles and
responsibilities which are set out in detail in the policy; and
• An effective governance framework is in place to ensure that risk management is embedded in business
activity. The governance structure is based on a three lines of defence model.
The risk management methodology employed by the Syndicate reflects the relevant elements identified in the risk
register. Risks relating to underwriting (including business planning and pricing risk), reserving and outwards
reinsurance are identified, along with relevant emerging risks are identified, measured, monitored and reported.
Dependencies between insurance risks as well as between risk categories are taken into account, in particular as
regards capital requirements.
Risks are monitored on a regular and timely basis based on suitable management information. Risks at all relevant
levels and over appropriate geographical areas are measured regularly. This information can then be reported to
appropriate parties, such as committees and Board of Directors of AWMA at a suitable level of aggregation and on
a regular basis, typically quarterly. Key risk indicators are used to measure exposure against risk appetite, based on
tolerance criteria which are set beforehand by the Board of AWMA.
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
Allied World Managing Agency Limited 39
Syndicate 2232 | Annual Report and Accounts 2025
5. Analysis of Underwriting Result
An analysis of the underwriting result before investment return is set out below:
2025
Gross
premium
written
£000
Gross
premium
earned
£000
Gross
claims
incurred
£000
Gross
operating
expenses
£000
Reinsurance
balance
£000
Total
£000
Direct Insurance: | ||||||
| Accident and health | | | | ( | ( | |
| Motor (third party liability) | | | ( | ( | | |
| Motor (other classes) | | | ( | ( | ( | ( |
| Marine, Aviation and Transport | | | ( | ( | ( | |
| Fire and other damage to property | | | ( | ( | ( | |
| Third-party liability | | | ( | ( | ( | |
| Miscellaneous | | | ( | ( | | ( |
| Direct Insurance | | | ( | ( | ( | |
Reinsurance | | | ( | ( | ( | |
| Total | | | ( | ( | ( |
2025
Gross
premium
written
£000
Gross
premium
earned
£000
Gross
claims
incurred
£000
Gross
Operating
expenses
£000
Reinsurance
balance
£000
Total
£000
Additional analysis: | ||||||
Fire and other damage to property of which is: | ||||||
| Energy | | | ( | ( | ( | ( |
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
Allied World Managing Agency Limited 40
Syndicate 2232 | Annual Report and Accounts 2025
5. Analysis of Underwriting Result (continued)
2024
Gross
premium
written
£000
Gross
premium
earned
£000
Gross
claims
incurred
£000
Gross
operating
expenses
£000
Reinsurance
balance
£000
Total
£000
Direct Insurance: | ||||||
| Accident and health | | | ( | ( | | ( |
| Motor (third party liability) | | | ( | ( | | ( |
| Motor (other classes) | | | ( | ( | ( | |
| Marine, Aviation and Transport | | | ( | ( | | |
| Fire and other damage to property | | | ( | ( | ( | |
| Third-party liability | | | ( | ( | ( | |
| Miscellaneous | | | | ( | ( | |
| Direct Insurance | | | ( | ( | ( | |
Reinsurance | | | ( | ( | ( | |
| Total | | | ( | ( | ( |
2024 | Gross premium written £000 | Gross premium earned £000 | Gross claims incurred £000 | Gross Operating expenses £000 | Reinsurance balance £000 | Total £000 |
Additional analysis: | ||||||
Fire and other damage to property of which is: | ||||||
| Energy | | | ( | ( | ( | |
Of the £520.4m gross premium written (2024: £472.5m), £434.5m were underwritten in the UK (2024:
£369.5m), £56.8m were underwritten in Asia (2024: £60.3m) and £29.1m were underwritten in Europe (2024:
£42.7m).
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
Allied World Managing Agency Limited 41
Syndicate 2232 | Annual Report and Accounts 2025
6. Claims Development
The following tables show the development of claims over a period of time on both a gross and net of reinsurance
basis. The top half of the table shows how the estimates of total claims for each underwriting year develop over time.
The lower half of the table reconciles the cumulative claims to the amount appearing in the balance sheet.
Cumulative claims estimates and cumulative payments are translated into Pounds Sterling at the period end rate as at
31 December 2025.
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.
Analysis of claims
development -
Gross
2016
£000
2017
£000
2018
£000
2019
£000
2020
£000
2021
£000
2022
£000
2023
£000
2024
£000
2025
£000
Total
£000
Estimates of gross claims | |||||||||||
End of underwriting year | | | | | | | | | | | |
One year later | | | | | | | | ||||
Two years later | | | | | | | | | |||
Three years later | | | | | | | | | | ||
Four years later | | | | | | | | | | | |
Five years later | | | | | | | | | | | |
Six years later | | | | | | | | | | | |
Seven years later | | | | | | | | | | | |
Eight years later | | | | | | | | | | | |
Nine years later | | | | | | | | | | | |
Estimate of gross claims reserve | | | | | | ||||||
Provision in respect of prior years | — | — | — | — | — | — | — | — | — | — | |
Less gross claims paid | | | | | | | | | | | |
Gross claims reserve | | | | | | | | |
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
Allied World Managing Agency Limited 42
Syndicate 2232 | Annual Report and Accounts 2025
6. Claims Development (continued)
Analysis of claims
development -
Net
2016
£000
2017
£000
2018
£000
2019
£000
2020
£000
2021
£000
2022
£000
2023
£000
2024
£000
2025
£000
Total
£000
Estimates of net claims | |||||||||||
End of underwriting year | | | | | | | | | | | |
One year later | | | | | | | | | | | |
Two years later | | | | | | | | | | | |
Three years later | | | | | | | | | | | |
Four years later | | | | | | | | | | | |
Five years later | | | | | | | | | | | |
Six years later | | | | | | | | | | | |
Seven years later | | | | | | | | | | | |
Eight years later | | | | | | | | | | | |
Nine years later | | | | | | | | | | | |
Estimate of net claims reserves | | | | | | | | | | | |
Provision in respect of prior years | — | — | — | — | — | — | — | — | — | — | |
Less net claims paid | | | | | | | | | | | |
Net claims reserve | | | | | | | | | | | |
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
Allied World Managing Agency Limited 43
Syndicate 2232 | Annual Report and Accounts 2025
7. Technical Provisions
The change in net provision for claims is made up of the following:
Gross Reinsurers' share Net
2025
£000
As
Restated
2024
£000
2025
£000
As
Restated
2024
£000
2025
£000
As
Restated
2024
£000
Unearned premium reserve | ||||||
| At 1 January | | ( | ( | | | |
| Premiums written during the year | | ( | ( | | ||
| Premiums earned during the year | ( | ( | | | ( | ( |
| Foreign exchange movements | ( | ( | ( | ( | ( | |
| Total at 31st December | | ( | ( | | |
Gross Reinsurers' share Net
2025
£000
2024
£000
2025
£000
2024
£000
2025
£000
2024
£000
Deferred acquisition costs | ||||||
| At 1 January | | | ( | ( | | |
Incurred deferred acquisition costs | | ( | ( | | | |
Amortised deferred acquisition costs | ( | ( | | | ( | ( |
| Foreign exchange movements | ( | ( | ( | ( | ( | |
| Total at 31st December | | | ( | ( | |
Gross Reinsurers' share Net
2025
£000
2024
£000
2025
£000
As
Restated
2024
£000
2025
£000
As
Restated
2024
£000
Claims outstanding | ||||||
| At 1 January | | | ( | ( | | |
| Claims paid during the year | ( | ( | | | ( | ( |
Expected cost of current year claims | | | ( | ( | | |
Change in estimates of prior year provisions | ( | ( | | | ( | ( |
| Foreign exchange movements | ( | ( | ( | ( | ( | |
| Total at 31st December | | ( | ( | | |
Restatement of prior period
During the year management identified a misclassification of movements within the unearned premium reserve
provision and claims outstanding provision which was reported within the technical provisions above.
Comparative figures in these financial statements have been restated accordingly.
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
Allied World Managing Agency Limited 44
Syndicate 2232 | Annual Report and Accounts 2025
8. Net Operating Expenses
2025 £000 | 2024 £000 | |
| Acquisition costs | | |
| Change in deferred acquisition costs | ( | ( |
| Administrative expenses | | |
| Member's standard personal expenses | | |
| Reinsurers' commissions and profit participation | ( | ( |
| Total | | |
AWMA does not charge a Managing Agency fee, it has recharged various expenses which have been incurred on the
Syndicate’s behalf. These amounted to £18.7m (2024: £17.7m) for the financial year.
Administrative expenses include fees payable to the auditors and their associates (exclusive of VAT). An analysis of
the auditors' remuneration is as follows:
2025 £000 | 2024 £000 | |
Audit fees: | ||
Fees payable to the Syndicate's auditors for the audit of these financial statements | | |
Non-audit fees: | ||
| Other services pursuant to legislation and tagging | | |
Other services pursuant to legislation include fees for the Syndicate half year review, year-end audit of Solvency UK
balance sheet, iXBRL tagging, QMA Delta audit and fees in respect of the Singaporean regulatory return annual
audit.
2025 £000 | 2024 £000 | |
| Total commission for direct insurance business | | |
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
Allied World Managing Agency Limited 45
Syndicate 2232 | Annual Report and Accounts 2025
9. Staff Numbers and Costs
The average number of full time equivalent employees employed by the Allied World group of companies
working on Syndicate matters during the year was as follows:
Number of employees
| 2025 | 2024 | |
Administration and finance | | |
Underwriting | | |
Claims | | |
Investments | | |
Total | | |
The table above includes 14 (2024: 14) employees who are employed directly by AWMA.
The following amounts were recharged by AWMA to the Syndicate in respect of payroll costs:
2025 £000 | 2024 £000 | |
Wages and salaries | | |
Social security costs | | |
Other pension costs | | |
Other incentives costs | | |
Total | | |
10. Emoluments of the Directors of AWMA
The Directors of AWMA received the following aggregate remuneration charged to the Syndicate and included
within net operating expenses.
2025 £000 | 2024 £000 | |
| Directors' emoluments | | |
The amount recharged to the Syndicate in respect of the aggregate remuneration of the active underwriter is as
follows:
2025 £000 | 2024 £000 | |
| Emoluments | | |
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
Allied World Managing Agency Limited 46
Syndicate 2232 | Annual Report and Accounts 2025
11. Investment Return
2025 £000 | 2024 £000 | |
Interest and similar income | ||
From financial instruments designated at fair value through profit or loss | ||
| Interest and similar income | | |
| Interest on cash at bank | | |
Other income from investments | ||
From financial instruments designated at fair value through profit or loss | ||
| Gains on the realisation of investments | | |
| Losses on the realisation of investments | ( | |
| 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 | | |
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
Allied World Managing Agency Limited 47
Syndicate 2232 | Annual Report and Accounts 2025
12. Other Financial Investments
Market Value 2025 £000 | Cost 2025 £000 | Market Value 2024 £000 | Cost 2024 £000 | |
Shares and other variable-yield securities and units in unit trusts | | | | |
| Debt securities and other fixed income securities | | | | |
| Syndicate loan to central fund | | | | |
Total | | | | |
All debt securities and other fixed income securities are listed on a recognised stock exchange and are valued at
fair value through profit and loss.
The Syndicate classifies its financial instruments held at fair value in its balance sheet using fair value hierarchy,
as follows:
• Level 1 - Quoted prices (unadjusted) in active markets for identical assets or liabilities
• Level 2 - Prices based on recent transactions in identical assets (either unadjusted or adjusted)
• Level 3 - Prices determined using the valuation technique
Valuation Techniques
Level one
Fair value is the amount for which an asset or liability could be exchanged between willing parties in an arm’s
length transaction. Fair values are determined at prices quoted in active markets.
Level two
Inputs include directly or indirectly observable inputs such as quoted prices for similar financial instruments
exchanged in active markets, quoted prices for identical or similar financial instruments exchanged in active
markets and other market observable inputs.
The fair value of the vast majority of the Syndicate investments in bonds are priced based on information
provided by independent pricing service providers while much of the remainder are based primarily on non-
binding third party broker-dealer quotes that are prepared using Level 2 inputs. Where third-party broker-
dealer quotes are used, typically one quote is obtained from a broker-dealer with expertise in the instrument
being priced.
Level three
A fair value that cannot be determined using direct observable market inputs nor based on available market
data but based on best information available.
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
Allied World Managing Agency Limited 48
Syndicate 2232 | Annual Report and Accounts 2025
12. Other Financial Investments (continued)
The table below analyses financial instruments held at fair market value in the Syndicate's balance sheet at the
reporting date by its level in the fair value hierarchy.
| 2025 | Level 1 | Level 2 | Level 3 | Total |
| £000 | £000 | £000 | £000 | |
Shares and other variable-yield securities and units in unit trusts | | | | |
Debt securities and other fixed income securities | | | | |
| Syndicate loans to central fund | | | | |
| Total | | | | |
| 2024 | Level 1 | Level 2 | Level 3 | Total |
| £000 | £000 | £000 | £000 | |
Shares and other variable-yield securities and units in unit trusts | | | | |
Debt securities and other fixed income securities | | | | |
| Syndicate loans to central fund | | | | |
| Total | | | | |
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
Allied World Managing Agency Limited 49
Syndicate 2232 | Annual Report and Accounts 2025
13. Debtors
2025 £000 | 2024 £000 | |
Debtors arising out of direct insurance operations: | ||
| Amounts due within one year | | |
| Total | | |
Debtors arising out of reinsurance operations: | ||
| Amounts due within one year | | |
| Total | | |
Other debtors | ||
| Other related party balances (non-syndicate) | | |
| Other debtors | | |
| Total | | |
14. Other Assets
Other assets of £42.7m (2024: £37.9m) comprise funds of overseas deposits that are lodged as a condition of
conducting underwriting business in certain countries. Certain overseas deposits relating to Australian situs
business previously funded by the Syndicate were replaced in 2013 by a letter of credit (LOC) funded by Allied
World Assurance Company, Ltd. The amount of LOC provided as at 31 December 2025 was £45.8m (31
December 2024: £39.4m).
15. Creditors
2025 £000 | 2024 £000 | |
Creditors arising out of direct insurance operations: | ||
| Amounts due within one year | | |
| Total | | |
Creditors arising out of reinsurance operations: | ||
| Amounts due within one year | | |
| Total | | |
Other creditors | ||
| Other related party balances (non-syndicate) | | |
| Other liabilities | | |
| Total | | |
Other creditors comprise mainly expense recharges from affiliated companies. Amounts due to group
undertakings are unsecured, interest free, have no fixed dated of repayment and are repayable on demand.
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
Allied World Managing Agency Limited 50
Syndicate 2232 | Annual Report and Accounts 2025
16. Post Balance Sheet Events
There have been no post balance sheet events which require disclosure or an adjustment to the financial
statements for the year ended 31 December 2025.
17. Distribution
A distribution to members of £100,110 k will be proposed in relation to the closing year of account 2023 (2024:
£45,870 k distribution in relation to the closing year of account 2022).
18. Funds at Lloyd’s
The fixed interest securities are provided and managed by a subsidiary of Allied World Assurance Company
Holdings, Ltd via a third party trust deed.
Every member is required to hold capital at Lloyd's which is held in trust and known as Funds at Lloyd's ("FAL").
These funds are intended primarily to cover circumstances where Syndicate assets prove insufficient to meet
participating underwriting members' underwriting liabilities.
The level of FAL that Lloyd's requires a member to maintain is determined by Lloyd's based on UK regulatory
requirements. FAL has regard to a number of factors including the nature and amount of risk to be
underwritten by the member and the assessment of the reserving risk in respect of business that has been
underwritten.
Since FAL is not under the management of AWMA, no amount has been shown in these annual accounts by way
of such capital resources. However, AWMA is able to make a call on the member’s FAL to meet liquidity
requirements or to settle losses.
As at 31 December 2025, FAL balance was £348.8m (31 December 2024 : £310.6m).
19. Foreign Exchange Rates
The functional currency of the Syndicate is US dollars . These financial statements are presented in Pounds
The following currency exchange rates illustrate the main foreign currency rates of exchange which were used
for currency translation.
2025 Start of period rate | 2025 Average rate | 2025 Year end rate | 2024 Start of period rate | 2024 Average rate | 2024 Year end rate | |
| Sterling | | | | | | |
| Euro | | | | | | |
| US dollar | | | | | | |
| Canadian dollar | | | | | | |
| Australian dollar | | | | | | |
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
Allied World Managing Agency Limited 51
Syndicate 2232 | Annual Report and Accounts 2025
20. Related Parties
Ultimate parent company
The immediate holding company of AWMA is Allied World Europe Holdings, Ltd, which is incorporated in
Bermuda. AWMA’s ultimate parent and to which the results of AWMA are consolidated into is Fairfax Financial
Holdings Limited.
The Syndicate has entered into various reinsurance arrangements with affiliates of Fairfax Financial Holdings
Limited. In respect of insurance and ceded outwards reinsurance activity, these amounts are included as part of
the technical account within the income statement.
Group financial statements may be obtained from 95 Wellington Street West, Suite 800, Toronto, Canada.
Allied World Managing Agency Limited ("AWMA")
AWMA does not charge a set Managing Agent fee but receives a mark-up on expenses recharged to the Syndicate
of 5%. In respect of expense recharge activity, these amounts are included as part of operating expenses.
Expenses recharged, including mark up, in 2025 were £18.7m (2024: £17.7m). The creditor balance as at 31
December 2025 was £10.3m (2024: £10.8m).
Allied World Syndicate Services (Singapore) Pte. Ltd ("AWSS")
The Syndicate underwrites business via the Lloyd's Asia Singapore platform. From 1 April 2014, AWSS has acted as
the Lloyd's Asia service company to facilitate the Syndicate’s underwriting in Singapore. In respect of expense
recharge activity, these amounts are included as part of operating expenses. The fees charged by AWSS to the
Syndicate were £3.1m (2024: £2.9m). The creditor balance as at 31 December 2025 was £(0.7)m (2024: creditor
£(0.7)m).
Allied World Reinsurance Management Company (“ARM”)
ARM acts as a cover-holder for the Syndicate underwriting business in Central and South America including the
Caribbean. In respect of insurance and ceded outwards reinsurance activity, these amounts are included as part of
the technical account within the income statement. In respect of expense recharge activity, these amounts are
included as part of operating expenses. The fees charged by ARM were £1.0m (2024: £1.0m). The creditor balance
as at 31 December 2025 was £(0.2)m (2024: £(0.2)m).
Allied World Syndicate Services (Bermuda), Ltd (“AWSB”)
AWSB acts as a cover-holder for the Syndicate underwriting business in Bermuda. In respect of insurance and
ceded outwards reinsurance activity, these amounts are included as part of the technical account within the
income statement. In respect of expense recharge activity, these amounts are included as part of operating
expenses. The fees charged by AWSB were £0.8m (2024: £0.5m). The debtor balance as at 31 December 2025 was
£4.7m (2024: £6.8m).
Allied World Assurance Company (Europe) dac (“AWE”)
The Syndicate is serviced in terms of accommodation, staff and other overhead costs by AWE. The Syndicate is
charged its share of these central costs. In respect of the cost sharing activity, these amounts are included as part
of operating expenses.
Allied World Assurance Company, Ltd (“AWA”)
The Syndicate participates in an intra-group reinsurance contract with AWA. In respect of insurance and ceded
outwards reinsurance activity, these amounts are included as part of the technical account within the income
statement. The effect of this contract on the profit and loss account in 2025 was a credit of £(17.4)m (2024:
£(4.1)m).
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
Allied World Managing Agency Limited 52
Syndicate 2232 | Annual Report and Accounts 2025
