ÿ
ÿ
1
2
2
34567ÿ97
2
ÿ
ÿ
ÿÿÿ !"ÿ#"$ÿ ÿ%!!$ÿ%!!"$$ÿÿ&$ÿ !
"ÿ$ÿ
"$!"
ÿÿ"$$ÿ'&ÿ&("ÿ)("ÿ&"ÿ!"*!ÿ$"ÿ&ÿ"+',ÿÿ&$ÿ !"ÿ&
$ÿ""ÿ
' "
ÿÿÿ ÿÿ&("ÿÿ""ÿ$-" ÿÿ)("ÿ&"ÿ!"*!.ÿ+"$"ÿ"ÿ'"ÿ
&ÿÿ
"ÿ+ÿ
"" ÿÿ!!"$$ÿÿÿÿ"ÿ+"ÿÿ)("ÿ&"ÿ!"*!,ÿ/&"ÿ$ !"ÿ"
$ÿ ÿ
!!
$ÿ$"ÿ&ÿÿ&$ÿ$"!ÿÿ&"ÿ0+ 1$ÿ'"$".ÿ'&!&ÿ&("ÿ""ÿ*+" ÿ'&ÿ0+
1$ÿÿ
!!
!"ÿ'&ÿ&"ÿ !"ÿ%!!)ÿ2"+'ÿ
3
4
,ÿ
5
ÿÿ
6
7
7
8
9
.ÿ"ÿ")ÿ(
" ÿÿ
+ÿ$"$ÿ+,ÿ/&"ÿ$ !"ÿ"$ÿ ÿ!!$ÿ&("ÿÿ""ÿ"
" ÿÿ
0+ 1$.ÿ
ÿ0+ 1$ÿ&$ÿÿ"$$+ÿÿ&"ÿ!!!ÿÿ!",ÿ%!!"$$ÿÿ&"ÿ$
!"ÿ
"$ÿ
ÿ!!$ÿ$ÿÿ")ÿ( " ÿÿ&"ÿ$"$ÿÿ$+!)ÿ""$&ÿ
ÿ0+ 1$ÿ
ÿ"
"$&ÿÿÿ$ !"ÿÿ0+ 1$.ÿ ÿÿ:"ÿÿ;ÿ0+ 1$ÿÿÿ$ !"ÿ
$ÿ")ÿ
"ÿ&"
",ÿ<""$ÿÿ0+ 1$ÿ"ÿ" " ÿ&ÿ$ÿ"!"ÿÿÿ$ !"
ÿÿÿ
$ !
"ÿ"ÿ$ÿÿ" !("ÿÿ&"ÿ"+" ÿ$ !"1$ÿ"!"ÿÿÿ$$
"="ÿ
$ !
"ÿ",ÿ>ÿ!-'+" )"ÿ ÿ)""ÿÿ&"ÿ"))ÿ$ÿÿ! ÿÿÿ!!"$
$)ÿ&"ÿ
$ !
"ÿ"$ÿ ÿ!!$,ÿ>ÿ+$ÿ)""ÿ&ÿÿ'++ÿÿ( "ÿÿ"$ÿ'&
ÿÿ!ÿ
ÿÿ
$ !"ÿ"ÿ ÿ!!$ÿ'&ÿ+$ÿ( )ÿ&"ÿ'&ÿÿ!ÿ
ÿ&$ÿ
!-'+
" )"ÿ ÿ)""".ÿÿ'&!&ÿ&"ÿ'++ÿ+$ÿ"ÿ ÿ
ANNUAL REPORT
AND ACCOUNTS 20 25
Syndicate 609
PROTECTING
WHAT’S NEXT
We protect clients around the world from the
risks they face, combining the strength of
tradition with a forward-looking mindset.
B / SYNDICATE 609 ANNUAL ACCOUNTS 2025
CONTENTS
ATRIUM SYNDICATE 609
– ANNUAL ACCOUNTS
2 Report of the Directors of the Managing Agent
14 Statement of the Managing Agent’s Responsibilities
15 Independent Auditor’s Report
19 Statement of Comprehensive Income
21 Balance Sheet
23 Statement of Changes in Members’ Balances
24 Statement of Cash Flows
25 Notes to the Financial Statements
ATRIUM SYNDICATE 609
– UNDERWRITING YEAR ACCOUNTS
52 Report of the Directors of the Managing Agent
59 Statement of the Managing Agent’s Responsibilities
60 Independent Auditor’s Report 2021 year of account
64 Independent Auditor’s Report 2023 year of account
68 Underwriter’s Report
71 Statement of Comprehensive Income 2021 year of account
73 Balance Sheet 2021 year of account
74 Statement of Cash Flows 2021 year of account
75 Statement of Comprehensive Income 2023 year of account
77 Balance Sheet 2023 year of account
78 Statement of Cash Flows 2023 year of account
79 Notes to the Financial Statements
94 Seven Year Summary of Results
DIRECTORS
Christopher Stooke Non-Executive Chairman
Nicole Coll Non-Executive Director
James Cox Executive Director
John Fowle Chief Executive Officer
Hans-Peter Gerhardt Non-Executive Director
Rachel Grunert Active Underwriter, Syndicate 2026
Peter Laidlaw Active Underwriter, Syndicate 609
Samit Shah Executive Director
Kirsty Steward Executive Director
ADVISORS
Auditor
KPMG LLP
Investment Manager
Wellington Management International Limited
Company Secretary
SGH Company Secretaries Limited
SYNDICATE 609 ANNUAL ACCOUNTS 2025 / 1
REPORT OF THE DIRECTORS
OF THE MANAGING AGENT
The Directors of the managing agent present their report for the year ended
31 December 2025.
This Annual Report is prepared using the annual basis of accounting as required by Statutory Instrument No. 1950 of 2008,
the Insurance Accounts Directive (Lloyd’s Syndicate and Aggregate Accounts) Regulations 2008 (Lloyd’s Regulations 2008)
and applicable United Kingdom Accounting Standards, including Financial Reporting Standard 102: The Financial Reporting
Standard applicable in the United Kingdom and Republic of Ireland (FRS102) and Financial Reporting Standard 103: Insurance
Contracts (FRS103) and the Lloyd’s Syndicate Accounts Instructions Version 3.1 as modified by the Frequently Asked
Questions Version 1.1 issued by Lloyd’s.
Separate underwriting year accounts for the 2021 year of account, which has been left open as at 31 December 2025 and
the 2023 year of account, which closed on 31 December 2025 , can be found on pages 52 to 94.
RESULTS
The Board of Directors (the Board) are pleased to announce total comprehensive income of £116.8m for Syndicate 609 (the
syndicate) for calendar year 2025 (2024 – total comprehensive income of £62.0m).
PRINCIPAL ACTIVITY AND REVIEW OF THE BUSINESS
The syndicate’s principal activity during the year continued to be the transaction of general insurance and reinsurance
business at Lloyd’s.
BUSINESS AND PERFORMANCE EVALUATION
The syndicate writes a diversified portfolio of classes of business that include Accident & Health, Aviation, Liability, Marine,
Non Marine Direct & Facultative, Property & Casualty Binding Authorities, Reinsurance, Upstream Energy and Terrorism.
The syndicate is managed in three distinct business groups – Property, Casualty and Specialty.
In underwriting a diversified portfolio of classes, using their skill, knowledge and historic claims data to evaluate the
potential claims costs and to determine the appropriate premium, and also by taking a limited amount of market and
credit risk in investing the cash flows generated by this activity, the syndicate aims to reward its capital providers with
results that are considered attractive relative to the risks assumed.
The key performance measure for the syndicate is return on adjusted Economic Capital Assessment (ECA). This is
determined by comparing the total comprehensive income to the syndicate’s ECA set by the Corporation of Lloyd’s on
agreement of the syndicate’s Solvency Capital Requirement (SCR) derived from its Internal Model, including Solvency
UK balance sheet adjustments. Return on Capital and the following Key Performance Indicators (KPI’s) are monitored
regularly by the Directors.
As Reported
2025
£’m
Pre LPT
2025
£’m
2024
£’m
Gross premiums written 947.1 947.1 1,026.5
Net earned premiums 641.6 791.3 846.3
Total Comprehensive Income 116.8 115.3 62.0
Loss ratio 34.2% 47.1% 57.0%
Combined ratio 90.4% 92.5% 99.5%
Investment return 58.0 59.1 59.4
Adjusted ECA 382.1 382.1 353.4
Return on adjusted ECA 30.6 % 30.2% 17.5%
2 / SYNDICATE 609 ANNUAL ACCOUNTS 2025
Loss Portfolio Transfer
On 13 January 2025, the syndicate entered into an loss portfolio transfer (LPT) agreement with Syndicate 2008, managed
by Enstar Managing Agency Ltd, the reinsurer.
The transaction covers the discontinued portfolios in Marine Treaty Reinsurance, Property Treaty Reinsurance and US
Contractors General Liability. The cover relates to business underwritten in 2023 and earlier (the majority relates to the
2021 year of account and earlier). The LPT is a reinsurance contract by nature. The syndicate ceded net loss reserves
of £153.3m with a loss limit of £240.9m. All claims handling responsibilities relating to the ceded policies have been
transferred to the reinsurer.
The premium payable associated with the transfer was £149.6m. There were further acquisition costs and interest charges
associated with the transaction. After allowing for these costs the net impact to the statement of comprehensive income
was a profit of £1.5m.
Russian Aviation Exposures
The syndicate has exposure to the fate of the western leased aircraft in Russia, which predominantly impacts the 2021
year of account. The classes impacted are Aviation War, Aviation Reinsurance and Marine XL The net ultimate loss is split
2% to the 2020 YOA, 87% to the 2021 YOA and 11% to the 2022 YOA.
At 31 December 2024, a probabilistic approach was taken to deriving the reserving position for this loss, which considered
the financial implications of various scenarios. This approach has continued to be used at 31 December 2025, and the
scenarios and their likelihood continue to rely on expert judgement, supported by legal advice where appropriate. These
scenarios reflect actual settlements to date as well as the June 2025 judgement in England and Wales in respect of Russian
Aircraft Lessor Policy Claims. Updating the scenarios to reflect the latest information has led to an overall increase in the
estimated ultimate loss assessment with expected ultimate gross claims of £513.0m and £146.2m net of reinsurance as at
31 December 2025 (as at 31 December 2024 – £393.4m gross, £113.8m net of reinsurance).
The situation is complex and continues to develop. The Directors, in conjunction with the relevant subject matter experts,
continue to monitor the situation closely, taking legal advice and meeting with market participants on a regular basis to
ensure that the most up to date information and appropriate assumptions are reflected within the scenarios applied in
determining the syndicate reserves.
Due to the nature of the underlying circumstances, both in respect of settlement of claims and the associated reinsurance
recoveries, the potential for variation to the booked reserves is considerably greater than the normal level of reserve
sensitivity to risk and the actual outcome of the loss could be in a particularly wide range with greater than usual
variability. As a result, the 2021 year of account will continue to remain open until the level of reserve sensitivity to risk
normalises.
Property Business Group
Classes of business which experienced significant compounded rate increases over the past few years continue to
maintain healthy margins despite some material rate reductions. Premium reductions across North America property
binders are a result of targeted changes made by the underwriting teams in response to the California wildfires and less
demand for bespoke products in response to a slowing of the US economy.
The Property business group was exposed to the California Wildfires in January 2025, with gross losses of £50.2m and net
losses of £37.1m contributing 5.3% and 5.8% to the gross and net loss ratios respectively across the following classes of
business: Property Direct USA, Property RI, Cargo Fine Art & Specie and Non-Marine D&F. The latter half of the year was
impacted by Hurricane Melissa with gross and net losses of £14.3m contributing 1.5% and 2.2% to the gross and net loss
ratios respectively, mainly impacting the Non-Marine D&F class of business.
SYNDICATE 609 ANNUAL ACCOUNTS 2025 / 3
REPORT OF THE DIRECTORS OF
THE MANAGING AGENT CONTINUED
Casualty Business Group
Set against a backdrop of a challenging marketplace of declining rates and robust competition, the Casualty business
group continues to enhance its product offering to grow in profitable markets. Development of new products, API roll-
out within the AU Gold platform and targeted new business in the diversified class of business are all examples where
underwriting teams have identified opportunities for profitable growth.
In the prior year the Casualty business group experienced deterioration to the prior year reserves as a result of
construction defect claims in Florida. The successful completion of the LPT, noted above, has managed further
deterioration of this book of business. With limited large loss exposure in 2025, the performance of Casualty has
significantly improved from 2024, delivering a combined ratio of 76.7%.
Specialty Business Group
As seen across all business groups, Specialty has also experienced rating environment pressure and fewer new business
opportunities. Gross written premiums are lower than 2024, driven by Aviation War which was expected as part of the
2025 planned premium targets.
The Specialty business group has been affected by the aforementioned deteriorations on Russia. Additionally there have
been a number of aviation loss events during the year, the largest being Air India, with gross losses of £8.6m and net
losses of £5.0m.
INVESTMENT PERFORMANCE
Markets closed 2025 on a strong note, with global equities, fixed income, and most commodities delivering positive
returns. Despite this broad strength, the year was marked by meaningful rotations: Europe led early before emerging
markets took over in the second half, supported by a weaker US Dollar and improving fundamentals. The Federal Reserve
delivered three rate cuts totaling 75 bps, helping anchor financial conditions, while US Treasury yields ended the year
at 4.18% for the 10 year and 4.84% for the 30 year. Credit markets remained resilient, with high yield and EM sovereigns
outperforming as spreads tightened, even from already elevated levels.
The main sectors invested in are Investment Grade Corporates, US Government bonds, Taxable Municipal bonds and
Agency Mortgage Backed Securities.
The table below compares the actual investment performance with the 2024 calendar year based on profits returned by
holdings in each currency based on the average funds held in underlying investments, excluding overseas deposits.
2025
%
2024
%
US Dollar 4.9 4.8
Canadian Dollar 3.9 4.9
Euro 2.8 4.0
Sterling 5.7 5.7
4 / SYNDICATE 609 ANNUAL ACCOUNTS 2025
RISK STRATEGY
Understanding its Risk Universe, the range of risks to which it is exposed, quantification and management of those risks
enable the syndicate to determine the capital required to provide suitable security to its policyholders and to ensure that
syndicate capital providers are delivered returns appropriate for the risk they assume. Management of risk and return is
the core discipline of the business, against which all significant strategic and operational decisions are evaluated.
The Directors are responsible for setting the risk strategy for the syndicate and for oversight of its implementation.
The syndicate’s risk strategy is to actively take on underwriting risks across a balanced range of (re)insurance classes
where the expected margins more than compensate for the risk to the syndicate and/or the costs of risk mitigation e.g.
reinsurance. In addition, the syndicate seeks investment risk where it is adequately rewarded and the level of risk does
not constrain the syndicate’s underwriting.
As part of the annual business planning process, the Board determines a Risk Policy Statement, which sets out the levels
of planned risk taking, sometimes referred to as Risk Appetite, the basis on which these risk levels will be monitored, and
the actions to be taken in the event of deviations from the planned levels. The Managing Agency has a comprehensive
governance framework within which the syndicate’s exposures to these risks are managed. The governance framework is
discussed further below.
PRINCIPAL RISKS AND UNCERTAINTIES
Governance
The Board recognises the critical importance of having efficient and effective risk management systems in place but
also recognises that it can only mitigate risks, and not eliminate them entirely. The Board has developed its Own Risk
and Solvency Assessment (ORSA), comprising the entirety of the processes that it uses to identify, assess, monitor and
report the risks faced by the syndicate and to evaluate the amount of funds necessary to cover these risks taking into
consideration the business profile and risk appetite of the syndicate. Critical to the efficacy of the ORSA is the effective
operation of the Risk Management Framework (RMF), the Governance Structure and the syndicate Internal Model. The
RMF incorporates the so-called “Three Lines of Defence” approach to risk management and reporting.
The RMF is the mechanism through which the syndicate ensures it is implementing effective and enterprise wide risk
management practices across its business. Key to the business is the management of risk, return and capital, against
which all significant strategic and operational business decisions are evaluated. The syndicate has established systems of
governance and risk management that enable it to manage its business prudently.
The RMF is the articulation of these systems of risk management and governance and how the various elements interact.
The RMF encompasses the broad range of activities undertaken across the organisational hierarchy to ensure that risks
are managed appropriately, spanning from the high level strategy set by the Board to the day-to-day underwriting
decisions being made by syndicate staff and the controls in place to govern these. The RMF can be illustrated as follows:
Strategy: This describes the strategy setting process and explains how this filters down through the organisation;
incorporating the syndicate’s Business Strategy, Business Plan, Risk Policy Statement and Risk Policies.
Business Activities: All business units are responsible for implementing the strategy and business plans in accordance
with the framework set out in the risk policies.
The people, controls, management information, processes and senior management oversight in place across the business
units serve as the “First Line of Defence” in the RMF.
Risk Governance Structure: The Board has established a Risk Governance Structure in order to ensure that risk is
appropriately identified, monitored, managed and reported across the organisation; to review the activities of the
business units; and to ensure that the RMF is effectively designed, implemented and governed.
The Risk Governance Structure is comprised of the Risk Committee (RC), which fulfils the role of the syndicate’s Risk
Management Function, the Internal Model Governance Committee (IMGC), the Risk Governance & Oversight Committee
(RGOC), and the Risk Sub-Committees, discussed further, below.
SYNDICATE 609 ANNUAL ACCOUNTS 2025 / 5
REPORT OF THE DIRECTORS OF
THE MANAGING AGENT CONTINUED
Independent Assurance: The syndicate has in place a Compliance Function and an Actuarial Function in addition to
the Risk Management Function (fulfilled by the RC, the RGOC and the Risk Management Team). These functions have
specific responsibilities documented in their terms of reference and are staffed by fit and proper individuals with suitable
qualifications, expertise and experience. The activities of these functions seek to provide the Board with assurance as
to the appropriateness and effectiveness of the various elements of the RMF, the internal control environment, and the
calculation of capital.
There are a number of risk management tools which support independent assessment and reporting of risk. Taken
together this Independent Assurance comprises the “Second Line of Defence”.
Independent Oversight: The RMF provides for independent oversight and challenge via the operation of the Internal
Audit Function as well as the Audit Committee, which is a Committee of the Board with membership comprised of Non-
Executive Directors. Together, these two groups provide the “Third Line of Defence”. The Audit Committee, along with
its broader responsibilities for the financial statements and financial reporting process, has oversight of internal controls
and the Internal Audit Function.
Risk Committee (RC)
The RC fulfils the Risk Management Function, in conjunction with the RGOC and the Risk Management Team, and
coordinates the risk management activities conducted for the syndicate. The RC has its membership comprised of Non-
Executive Directors though is attended by various Executives to ensure that the RC is provided with the information it
requires to perform its role. It is responsible for ensuring that the RMF and Internal Model operate effectively, and for
maintaining an aggregated and holistic view of risks to the syndicate and reporting on them to the Board, committees and
management as appropriate. It also ensures that there is robust and effective management, governance and oversight of
the syndicate Internal Model which is used to set capital and is also widely used within the business.
Due to overarching considerations of climate change and Environmental, Corporate and Social Governance (ESG) in
strategy setting and risk profile changes, this committee is also responsible for oversight of the climate change and
sustainability frameworks.
To support delivery of the RC’s responsibilities, there is the Capital Committee, RGOC and its Risk Sub-Committees,
each being responsible for oversight, review and challenge of the activities of the syndicate and in particular, ensuring
activities are within risk policies, that risks are suitably identified, monitored and reported, and that appropriate
contingency plans are in place.
The Capital Committee has been set up in 2026 to support the Risk Committee by providing challenge on the Internal
Model and reviews of model changes.
The principal risks to which the syndicate is exposed are discussed below, together with the mitigation techniques
adopted. For clarity, the risks are analysed by reference to the Risk Sub-Committees that have responsibility for the
relevant risk area.
The RGOC exists to support the RC and ensure that it can focus on key issues and also to ensure that there is the scope
for executive discussion on risk issues and aggregation across the Risk Sub-Committees prior to the RC.
Insurance Risk Sub-Committee (IRSC)
The IRSC is responsible for oversight of insurance risk which includes underwriting, claims, reserving and reinsurance.
Underwriting risk is the risk that future losses are greater than allowed for within premiums. This could be due to
natural fluctuations in claims frequencies and severities, changes in economic and judicial environments, anti-selection,
inappropriate premium estimation or catastrophic loss activity.
Underwriting risk is mitigated through numerous controls including underwriter peer review, authority limits,
independent review of risks written and purchase of an appropriate reinsurance programme. The Syndicate Business
Forecast is completed annually and stipulates those classes of business and concentration by class that will be written
during the forthcoming year. It is reviewed by the IRSC and approved by the Board prior to being submitted to Lloyd’s for
approval. Actual performance during the year is monitored by reference to the Syndicate Business Forecast.
6 / SYNDICATE 609 ANNUAL ACCOUNTS 2025
The risk of catastrophic claims is mitigated by the syndicate having a defined risk appetite which determines the net
loss that it intends to retain for major catastrophe events and where deemed appropriate, reinsurance is purchased to
limit the impact of losses. Although the likelihood of occurrence is considered to be remote, there may be circumstances
where the loss from a particular catastrophe event exceeds the net risk appetite perhaps due to the occurrence of a loss
that has not been considered or where the reinsurance purchased proves to be insufficient. In addition climate change
can affect the occurrence and severity of weather related events. Whilst the impact of these is researched, there is
significant uncertainty to the impact climate change has on events in the tail of distributions which increases uncertainty
in this area.
Reserving risk is the risk that there is insufficient provision for losses that have already occurred.
Reserving risk is mitigated by the robust reserve adequacy exercise that is performed on a quarterly basis by the Actuarial
Function and approved by the Board. The quarterly exercise involves a review of the paid and outstanding claims and
an assessment of the appropriate provision for incurred but not reported (IBNR) claims. The reserves are considered
by the IRSC and approved by the Board. The reserving is carried out based on historical development data, the claims
environment and information provided by lawyers and third party claims adjusters. In addition the IRSC and Board
receives the results of analysis performed by an external actuarial firm to assist their review.
Although a thorough review process is carried out, the reserves carried may be more or less than adequate to meet the
final cost of claims.
The IRSC also reviews the proposed reinsurance programme that is used to protect capital from the frequency and
severity of losses that may be sustained through underwriting the varied lines of business written. The review includes
analysis of the reinsurance cover being purchased and assessment of the proposed counterparties.
During 2026 the IRSC will be replaced by an Underwriting Committee reporting directly into the Board (and Chaired by
an Independent Non-Executive Director (INED)) and a Reserving Committee which will report into the Audit Committee,
both of which would oversee the syndicate.
Financial Risk Sub-Committee (FRSC)
The FRSC is responsible for oversight of financial risks and the steps taken to mitigate them as they arise from investments,
asset/liability management, credit, liquidity and concentration risks. These risks are discussed further below.
Investment risk is the risk that the syndicate’s earnings are affected by changes in the value of the investment portfolio, such
changes in value may be driven by changes in the economic and political environment and by movements in interest and
foreign exchange rates. The syndicate’s investments are managed in accordance with investment guidelines established by
the Board and are reviewed on a regular basis. The FRSC monitors the performance of the external investment managers
and the custodians responsible for the safekeeping of the investments, and reports regularly to the Board.
Asset/liability mismatch is the risk that the syndicate could incur a loss through inadequate matching of its investments
with its insurance liabilities. Due to the short tail nature of the majority of these liabilities, the syndicate does not seek
to achieve a precise matching with the investment portfolio, instead developing an investment duration guideline that is
broadly in line with the average payment profile of the liabilities. However, the syndicate substantially mitigates exposures
to currency mismatch by investing premiums in the currency in which subsequent claims are most likely to be incurred
and periodic rebalancing to ensure that these remain appropriate for the liabilities. The majority of the syndicate’s
business is denominated in US Dollars and accordingly the substantial part of the investment portfolio is in US Dollar
denominated investments.
The key aspect of credit risk is the risk of default by one or more of the syndicate’s reinsurers, their investment
counterparties, or insurance intermediaries. Reinsurance is placed with security that adheres to the reinsurance policy.
The exposure to credit risk in the investment portfolio is mitigated through adherence to the investment guidelines
which require the syndicate’s core investment portfolios to be held in government and corporate debt with a high credit
quality rating and with a relatively short duration, thus substantially mitigating the risk of sustaining losses from default.
Exposure to intermediaries is mitigated by rigorous review of new intermediaries, contractual terms of business,
regulated or segregated client accounts, monitoring of balances and credit control procedures.
SYNDICATE 609 ANNUAL ACCOUNTS 2025 / 7
REPORT OF THE DIRECTORS OF
THE MANAGING AGENT CONTINUED
Liquidity risk is the risk that the syndicate will not be able to meet its short term liabilities as they fall due, owing
to a shortfall in cash. This risk is mitigated through holding invested funds in high credit quality and short duration
investments. Cash flow projections are also reviewed on a regular basis. The need for overdraft facilities in case of an
unprojected cash flow deficit is also reviewed regularly.
Concentration risk is the exposure to loss that could arise if the bulk of the amounts recoverable by the syndicate were
dependent on a limited number of reinsurers, or if investments were restricted to limited numbers of counterparties or
sectors. The risk is mitigated by restricting the permitted cessions to individual reinsurers for any one underwriting year
and through the investment guidelines which limit exposure to individual investment counterparties and sectors.
Operational Risk Sub-Committee (ORSC)
The ORSC is responsible for oversight of the syndicate’s exposures to operational and regulatory risks.
Operational risk is the risk of loss due to inadequate or failed processes and procedures, people and systems, or
external events. The syndicate seeks to manage these risks by operating a control based environment which consists of
documented procedures, segregation of duties and appropriate levels of review.
Regulatory risk is the risk of loss owing to a breach of regulatory requirements or failure to respond to regulatory
change. The Managing Agency has a Compliance Officer and team who monitor regulatory developments and assess the
impact on agency policy and maintain an ongoing open dialogue with both regulators and Lloyd’s. They also carry out a
compliance monitoring programme.
Regular reviews are performed by the Internal Audit department to ensure that deviations from the agency’s policies, and
control weaknesses, are identified and reported to the appropriate level of management and the Audit Committee when
considered necessary.
Customer Oversight Group
The Customer Oversight Group is responsible for oversight of the syndicate’s exposure to conduct risk and ensuring that
the syndicate is providing good outcomes to customers as set out in the Financial Conduct Authority’s (FCA) Consumer
Duty. The Customer Oversight Group reports directly to the Board.
Conduct risk is the risk that, as part of writing and servicing insurance policies, the syndicate fails to pay due regard
to the interests of its customers. This is mitigated through the application of a conduct risk policy and procedures and
through staff’s adherence to a Code of Business Principles and Ethics. Atrium is committed to conducting its activities and
stakeholder relationships in a fair and honest manner and the highest standard of conduct, professionalism and integrity
is expected from all of its employees, with due regard paid at all levels of the organisation to ensuring good outcomes for
customers. Key controls include training of staff, embedding of the consideration of conduct risk as part of the business
planning process and through the product life-cycle and Board and governance oversight and reporting. The Customer
Oversight Group fulfils the role of a “product oversight group” providing customer challenge and perspective to the
syndicate’s products. Hans-Peter Gerhardt (INED) was appointed by the Board as Consumer Duty Champion from December
2025 following the resignation of Stephen Hearn who had previously held this appointment.
Executive Committee (XCo)
The XCo deals with the day-to-day activities of the Atrium Group, including Atrium Underwriters Limited (AUL), and is
responsible for developing and executing the strategic priorities of the business, developing and implementing business
plans, policies, procedures and budgets that have been recommended and approved by the Board, monitoring the
operating and financial performance of the syndicate, prioritising and allocating investment and resources, and managing
the risk profile of the syndicate. The XCo is responsible for the people strategy and establishment of the culture, values
and behaviours of the organisation. The XCo implements policy and strategy adopted by the Board and deals with all
operational matters affecting the syndicate.
XCo is an executive committee of the Board and is the overall decision-making body for performance and delivery, under
delegated authority from the Board. Members of XCo include the Executive Directors of the Managing Agency and the
8 / SYNDICATE 609 ANNUAL ACCOUNTS 2025
Chief Strategy Officer with the Chair being the Chief Executive Officer of the Managing Agent or, in their absence, any
other member of the committee.
Effective 1 January 2026 XCo has moved to be a group level executive committee of the Atrium Underwriting Group
Limited (AUGL) Board with the same membership and with clear delegation of authority from both AUGL and AUL Boards.
Culture Committee
The Culture Committee is a sub-committee of the XCo which reviews and provides formal governance over all areas relating
to culture, namely the creation of a work environment that reflects the XCo approved values and enables its people to
achieve their full potential and do their best work. It has a diverse membership from across the business, of different levels
of seniority, which is refreshed annually.
CLIMATE CHANGE AND SUSTAINABILITY
Governance
The Chief Risk Officer is the Executive Director with responsibility for sustainability and managing the financial risks
from climate change risk. There is regular communication with the XCo to ensure sustainability and climate change are
incorporated into strategic decisions. In terms of formal governance, the RC is responsible for reviewing updates to the
sustainability strategy and framework prior to Board approval, as well as assessing other sustainability-related risks. This is
due to the overarching ramifications of climate change and other sustainability factors in strategy setting and risk profile
changes. Sustainability is a standing agenda item for this Committee.
Strategy
Climate risk can be broadly divided into three categories: physical, transition and liability. Physical risk relates to the
change in climate and weather events which have the potential to directly affect the economy. Transition risk can occur
when moving towards a lower carbon economy and how the speed of the transition may affect certain sectors and affect
financial stability. Liability risk refers to potential increased litigation against policyholders from individuals or businesses
who have experienced losses because of physical or transition risk.
The syndicate has a dedicated sustainability strategy to manage physical, transition and liability aspects. Strategic
objectives have been mapped to, and integrated with, the overall group strategy to ensure risks and opportunities from
climate change and other sustainability aspects are fully embedded within the business. The syndicate has always been
fully focused on managing the physical risks of the business it writes and it has a formalised framework specifically for
managing physical climate risk. This addresses potential, current and future climate impacts on the natural catastrophe
exposed portfolio by regional peril combinations and identifies potential risk mitigation strategies.
An assessment of transition risk is made as part of the syndicate’s ORSA process and further analysis is performed during
the business planning process. This allows the syndicate to identify areas of the portfolio with more material exposures as
well as providing some metrics to our categorisations. The transition risk from our investment portfolio is limited due to
the short duration of the portfolio and the lack of investment in equities.
In terms of liability risk, the syndicate assesses its exposures on high-risk classes via risk assessments looking at potential
litigation risks and potential mitigations such as exclusion clauses embedded into policy wording. In addition, the risk
team review current trends in climate risk litigation and their applicability to the underwriting portfolios. The syndicate
is focused on taking advantage of the new opportunities that a shift to a low carbon economy might bring, whilst being
mindful of the commerciality of these and managing the associated risks encountered with new technology, scarcity of
data, uncertainty of forward-looking scenarios and the potential of systemic risk.
Sustainability considerations are incorporated into the annual business planning submissions, with each class of business
factoring in both the risks and opportunities posed to them. This is an iterative process which will be enhanced year-on-
year to help shape the strategy.
SYNDICATE 609 ANNUAL ACCOUNTS 2025 / 9
REPORT OF THE DIRECTORS OF
THE MANAGING AGENT CONTINUED
Risk Management
The aim of risk management is to ensure durability and value for stakeholders by managing the risks and opportunities
presented by climate change in a holistic and balanced manner, embracing the values of an integrated governance structure.
The syndicate’s collaborative culture and relative agility in the Lloyd’s market means it is well placed to achieve this ideal.
The syndicate has formal sustainable underwriting rules and guidelines which state its appetite for certain risks. These rules
and guidelines incorporate the syndicate’s stance on areas which it deems not to be conducive with its wider sustainability
strategy, as well as formalising compliance with Lloyd’s guidance regarding no new cover for thermal coal-fired power
plants, thermal coal mines, oil sands and Arctic energy exploration activities. In addition, the syndicate has a comprehensive
responsible investment policy which covers its governance framework, risk appetite, metrics and ESG integration. The
syndicate has processes in place to help ensure underwriters and investment managers comply with these. The Internal
Model of the syndicate that is used to assess risk and calculate capital requirements incorporate climate risk via a variety of
approaches. The syndicate continues to build on existing data and metrics related to climate risk, conduct tests of existing
models, systems and processes to ensure they are adequate and relevant, build on scenario analysis and stress testing,
review new opportunities (underwriting and technological) and increase knowledge and education. Third party data is used
on a measured basis, ensuring that both the advantages and disadvantages are understood. The syndicate endeavours to
incorporate climate risk and sustainability concerns across all decision-making processes and act as a responsible business.
Metrics and Targets
The syndicate has estimated its carbon emissions which are shown in the table below. 2025 emissions are not available yet
and the syndicate has not estimated the Scope 3 disclosures with respect to underwriting and investment portfolios.
Energy and greenhouse gas disclosures 2024 2023
Scope 1 (natural gas, other fuels, refrigerants) tCO2e:
15.9 147.4
Scope 2* (purchased electricity - location-based) tCO2e:
30.7 68.7
Scope 3:
– –
Business travel tCO2e:
1,496.8 941.7
Commuting/WFH, paper services, tech/hardware, furniture, data centres, waste, water tCO2e:
385.6 732.0
Total tCO2e:
1,929.0 1,889.8
Number of full-time employees
202.6 182.0
Carbon intensity – Total tCO2e/FTE
9.5 10.4
In 2024 total emissions stayed fairly consistent compared to 2023 with a 8.7% decrease in the carbon intensity due to the
increase in headcount.
As reported last year, we have moved our offices to a more sustainable building and this improvement in energy efficiency
can be seen in the significant decrease in our scope 1 and 2 emissions which have dropped by 78%. This is also reflected in
our scope 3 emissions (excluding business travel) as 2023 was significantly impacted by the office move. A major increase
was business travel which increased by 59% compared to the previous year (39% on an intensity basis).
From an investment perspective, the investment manager monitors and reports ESG ratings, weighted average carbon
intensity (WACI), science-based targets (SBTs) summary and implied temperature rise (ITR) summary for the portfolio
where available. Typically this is only for corporate bonds which are the largest asset class. In 2025 the syndicate has set
targets around all of these metrics for the first time.
The investment managers also report how they are engaging with companies on ESG matters and this is reviewed
quarterly.
10 / SYNDICATE 609 ANNUAL ACCOUNTS 2025
GROUP DEVELOPMENTS
On 7 July 2025 it was announced that Atrium Underwriting Group Limited (AUGL) had entered into a definitive agreement
with the CRC Group under which the CRC Group will acquire the managing agency from investment funds managed by
Stone Point Capital LLC and other investors.
Effective 25 November 2025 steps were completed to effect a group reorganisation and demerger, following which Atrium
Corporate Capital Limited (previously a subsidiary of AUGL) become a directly held subsidiary of Northshore Holdings
Limited (Northshore) and the remainder of the Atrium Group subsidiaries under Alopuc Limited were transferred to a
separate group owned by Northshore DM Limited (NDML), a Bermudian company. Immediately post the demerger NDML
had the same shareholders as Northshore.
Effective 31 December 2025 NDML was acquired by CRC Group UK Holdings Limited (a UK holding company) which is
100% owned by CRC Insurance Group, LLC (a US domiciled company). The Atrium Group retains its brand name and
independence under the leadership of its current management team within the CRC Group.
With effect from 1 January 2026, AUL is managing a new syndicate, Syndicate 2026. For the 2026 YOA Syndicate 2026 will
issue binding authorities to permit Atrium Insurance Agency Limited (AIAL) to underwrite Weather and US Delegated
Property Cat business on behalf of Syndicate 2026. Under the terms of the binding authorities, fees and profit commission
will be payable to AIAL. There will be no allocation of business between Syndicate 609 and Syndicate 2026 and no shared
reinsurance, although it is possible that Syndicate 609 may be invited and elect to participate on Syndicate 2026 led
binding authorities underwritten by AIAL in the future. Rachel Grunert has been appointed as the Active Underwriter for
Syndicate 2026 and was appointed to the Board on 1 January 2026. Capital to support Syndicate 2026 has been provided
by a number of third parties. AUL has in place appropriate governance procedures to manage both syndicates with each
syndicate having its own set of risk appetites and Lloyd’s approved business plan.
DIRECTORS AND OFFICERS
The Directors & Officers of the managing agent who served during the year ended 31 December 2025 and to the date of
signing these financial statements were as follows:
Nicole Coll
James Cox
John Fowle
Stephen Hearn (Resigned 1 December 2025)
Hans-Peter Gerhardt (Appointed 1 December 2025)
Rachel Grunert (Appointed 1 January 2026)
Peter Laidlaw
SGH Company Secretaries Limited (Company Secretary)
Samit Shah
Kirsty Steward
Christopher Stooke
DIRECTORS’ INTERESTS
Details of Directors’ interests may be found in note 23 to the accounts.
GOING CONCERN
The Directors have performed an assessment of the syndicate’s ability to continue as a going concern, including indirect
impacts of the war in Ukraine.
SYNDICATE 609 ANNUAL ACCOUNTS 2025 / 11
The syndicate has exposure to the fate of the western leased aircraft in Russia, which predominantly impacts the 2021
year of account. The classes impacted are Aviation War, Aviation Reinsurance and Marine XL. The net ultimate loss is split
2% to the 2020 YOA, 87% to the 2021 YOA and 11% to the 2022 YOA.
At 31 December 2024, a probabilistic approach was taken to deriving the reserving position for this loss, which considered
the financial implications of various scenarios. This approach has continued to be used at 31 December 2025 and the
scenarios and their likelihood continue to rely on expert judgement, supported by legal advice where appropriate. These
scenarios reflect actual settlements to date as well as the June 2025 judgement in England and Wales in respect of Russian
Aircraft Lessor Policy Claims. Updating the scenarios to reflect the latest information has led to an overall increase in the
estimated ultimate loss assessment with expected ultimate gross claims of £513.0m and £146.2m net of reinsurance as at
31 December 2025 (as at 31 December 2024 - £393.4m gross, £113.8m net of reinsurance).
The situation is complex and continues to develop. The Directors, in conjunction with the relevant subject matter experts,
continue to monitor the situation closely, taking legal advice and meeting with market participants on a regular basis
to ensure that the most up to date information and appropriate assumptions are reflected within the scenarios applied
determining the syndicate reserves.
Due to the nature of the underlying circumstances, both in respect of settlement of claims and the associated reinsurance
recoveries, the potential for variation to the booked reserves is considerably greater than the normal level of reserve
sensitivity to risk and the actual outcome of the loss could be in a particularly wide range with greater than usual
variability. As a result, the 2021 year of account will continue to remain open until the level of reserve sensitivity to risk
normalises.
The syndicate has a documented Stress & Scenario Testing Framework which sets out the stress, scenario and reverse
stress tests conducted during the year and the governance, reporting and escalation procedures around these. As per
its role to oversee and coordinate the stress testing process, the RGOC has reviewed this framework and the RC has also
reviewed and challenged the Framework tests.
The purpose of scenario testing is to assess the financial impact caused by a series of major detrimental events within one
scenario. The total financial impact is then used as a check of the Internal Model’s robustness and the syndicate’s overall
capital adequacy. The scenarios used by management are informed by the syndicate business plan, making them bespoke
to the business. As part of the stress testing work, reverse stress tests were also completed. Reverse stress tests assess
scenarios and circumstances that would render the syndicate’s business model unviable, thereby identifying potential
business vulnerabilities.
The Board’s long term strategy is to support the syndicate in managing the market cycle and providing long term sustainable
returns to capital providers and shareholders. The syndicate was able to open the 2026 year of account with stamp capacity
of £981.5m and at the current time there is an expectation that the syndicate will open a 2027 year of account.
As at 31 December 2025, the Board considers that the syndicate has more than adequate liquidity to pay its obligations as
they fall due. The syndicate held cash and cash equivalents of £116.6m and fixed maturity investments with maturity dates
of less than one year of £436.9m.
Based on the going concern assessment performed as at 31 December 2025, the Directors have formed a judgment that
there is a reasonable expectation that the syndicate has adequate resources to continue in operational existence in the
foreseeable future, a period of at least 12 months from the date of signing these financial statements. The 2026 year of
account has opened and based on the Directors’ assessment that the syndicate has sufficient resources to do so, they
have a reasonable expectation to be in a position to open a 2027 year of account. Accordingly, the Directors continue to
adopt the going concern basis in preparing the annual report and financial statements.
RE-APPOINTMENT OF AUDITOR
The Board of Directors have re-appointed KPMG LLP as the syndicate auditor for the year ending 31 December 2026.
KPMG LLP have indicated their willingness to continue in office as the syndicate auditor.
REPORT OF THE DIRECTORS OF
THE MANAGING AGENT CONTINUED
12 / SYNDICATE 609 ANNUAL ACCOUNTS 2025
SYNDICATE ANNUAL GENERAL MEETING
As permitted under the Syndicate Meetings (Amendment No.1) Byelaw (No.18 of 2000) AUL does not propose to hold a
Syndicate Annual General Meeting of the members of the syndicate. Members may object to this proposal or the intention
to reappoint auditors within 21 days of the issue of these financial statements. Any such objection should be addressed to
James Smith, Compliance Officer, at the registered office.
DISCLOSURE OF INFORMATION TO THE AUDITOR
So far as each person who was a Director of the managing agent at the date of approving this report is aware, there is no
relevant audit information, being information needed by the auditor in connection with its report, of which the auditor
is unaware. Having made enquiries of fellow Directors of the agency and the syndicate’s auditor, each Director has taken
all the steps that he/she is obliged to take as a Director in order to make himself/herself aware of any relevant audit
information and to establish that the auditor is aware of that information.
By order of the Board
John Fowle
Chief Executive Officer
16 February 2026
SYNDICATE 609 ANNUAL ACCOUNTS 2025 / 13
The Directors of the managing agent are responsible for preparing the syndicate annual
accounts in accordance with applicable law and regulations.
Insurance Accounts Directive (Lloyd’s Syndicate and Aggregate Accounts) Regulations 2008 requires the directors of the
managing agent to prepare their syndicate’s annual accounts for each financial year. Under that law they have elected to
prepare the annual accounts in accordance with UK Accounting Standards and applicable law (UK Generally Accepted
Accounting Practice), including FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland.
The financial statements are also prepared in accordance with Lloyd’s Syndicate Accounts Instructions Version 3.1 as
modified by the Frequently Asked Questions Version 1.1 issued by Lloyd’s.
Under Insurance Accounts Directive (Lloyd’s Syndicate and Aggregate Accounts) Regulations 2008 the directors of the
managing agent must not approve the annual accounts unless they are satisfied that they give a true and fair view of
the state of affairs of the syndicate and of the profit or loss of the syndicate for that period. In preparing these annual
accounts, the directors of the managing agent are required to:
• Select suitable accounting policies and then apply them consistently;
• Make judgements and estimates that are reasonable and prudent;
• State whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed
and explained in the annual accounts;
• Assess the syndicate’s ability to continue as a going concern, disclosing, as applicable, matters related to going
concern; and
• Use the going concern basis of accounting unless they either intend to cease trading, or have no realistic alternative
but to do so.
The Directors of the managing agent are responsible for keeping adequate accounting records that are sufficient to show
and explain the syndicate’s transactions and disclose with reasonable accuracy at any time the financial position of the
syndicate and enable them to ensure that the annual accounts comply with the Insurance Accounts Directive (Lloyd’s
Syndicate and Aggregate Accounts) Regulations 2008. They are responsible for such internal control as they determine is
necessary to enable the preparation of syndicate annual accounts that are free from material misstatement, whether due
to fraud or error, and have general responsibility for taking such steps as are reasonably open to them to safeguard the
assets of the syndicate and to prevent and detect fraud and other irregularities.
The Directors of the managing agent are responsible for the maintenance and integrity of the syndicate and financial
information included on the syndicate’s website. Legislation in the UK governing the preparation and dissemination of
syndicate annual accounts may differ from legislation in other jurisdictions.
STATEMENT OF THE MANAGING
AGENT’S RESPONSIBILITIES
14 / SYNDICATE 609 ANNUAL ACCOUNTS 2025
INDEPENDENT AUDITOR’S REPORT
TO THE MEMBERS OF SYNDICATE 609
OPINION
We have audited the Syndicate annual accounts of Syndicate 609 (“the Syndicate”) for the year ended 31 December
2025 which comprise the Statement of Comprehensive Income: Technical account – General Business, Statement of
Comprehensive Income: Non-Technical Account, Balance Sheet – Assets, Balance Sheet – Liabilities, Statement of
Changes in Members’ Balances, Statement of Cash Flows, and related notes, including the accounting policies in note 3.
In our opinion the 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 for the year then
ended;
• have been properly prepared in accordance with UK accounting standards, including FRS 102 The
Financial Reporting
Standard applicable in the UK and Republic of Ireland; and
• have been prepared in accordance with the requirements of the Insurance Accounts Directive (Lloyd’s Syndicate
and Aggregate Accounts) Regulations 2008, and Sections 1 and 5 of the Syndicate Accounts Instructions Version 3.1
as modified by the Syndicate Accounts Frequently Asked Questions Version 1.1 dated 13 February 2026, issued by the
Council of Lloyd’s (together “the Syndicate Accounts Instructions”).
BASIS FOR OPINION
We conducted our audit in accordance with International Standards on Auditing (UK) (“ISAs (UK)”), applicable law, and,
under the terms of our engagement letter dated 30 July 2025, the Syndicate Account Instructions. Our responsibilities are
described below. We have fulfilled our ethical responsibilities under, and are independent of the Syndicate in accordance
with, UK ethical requirements including the FRC Ethical Standard as applied to other entities of public interest. We
believe that the audit evidence we have obtained is a sufficient and appropriate basis for our opinion.
EMPHASIS OF MATTER – LEVEL OF UNCERTAINTY IN RUSSIAN AVIATION EXPOSURES
We draw attention to Note 2 of the Syndicate annual accounts, concerning the significant level of uncertainty in relation
to the possible claims arising out of the Syndicate’s Russian aviation exposures. This matter results in more potential
variability than would ordinarily be the case in the potential outcomes regarding technical provisions.
Our opinion is not modified in respect of this matter.
GOING CONCERN
The directors of the Managing Agent (“the Directors”) have prepared the Syndicate annual accounts on the going
concern basis as they do not intend to cease underwriting or to cease its operations, and as they have concluded
that the Syndicate’s financial position means that this is realistic. They have also concluded that there are no material
uncertainties that could have cast significant doubt over its ability to continue as a going concern for at least a year from
the date of approval of the Syndicate annual accounts (“the going concern period”).
In our evaluation of the Directors’ conclusions, we considered the inherent risks to the Syndicate’s business model and
analysed how those risks might affect the Syndicate’s financial resources or ability to continue operations over the going
concern period, including inspecting correspondence with the Council of Lloyd’s to assess whether there were any known
impediments to establishing a further year of account.
Our conclusions based on this work:
• we consider that the Directors’ use of the going concern basis of accounting in the preparation of the Syndicate
annual accounts is appropriate; and
• we have not identified, and concur with the Directors’ assessment that there is not, a material uncertainty related to
events or conditions that, individually or collectively, may cast significant doubt on the Syndicate’s ability to continue
as a going concern for the going concern period.
SYNDICATE 609 ANNUAL ACCOUNTS 2025 / 15
However, as we cannot predict all future events or conditions and as subsequent events may result in outcomes that
are inconsistent with judgements that were reasonable at the time they were made, the above conclusions are not a
guarantee that the Syndicate will continue in operation.
FRAUD AND BREACHES OF LAWS AND REGULATIONS – ABILITY TO DETECT
Identifying and responding to risks of material misstatement due to fraud
To identify risks of material misstatement due to fraud (“fraud risks”) we assessed events or conditions that could indicate
an incentive or pressure to commit fraud or provide an opportunity to commit fraud.
Our risk assessment procedures included:
• Enquiring of directors, the Audit Committee, internal audit and inspection of policy documentation as to the Syndicate
and Managing Agent’s high-level policies and procedures to prevent and detect fraud, including the internal audit
function, and the Syndicate and Managing Agent’s channel for “whistleblowing”, as well as whether they have knowledge
of any actual, suspected or alleged fraud.
• Reading Board and Audit Committee minutes.
• Considering remuneration incentive schemes and performance targets for management and directors.
• Using analytical procedures to identify any unusual or unexpected relationships.
We communicated identified fraud risks throughout the audit team and remained alert to any indications of fraud
throughout the audit.
As required by auditing standards, and taking into account possible pressures to meet profit targets and our overall
knowledge of the control environment we perform procedures to address the risk of management override of controls, in
particular the risk that management may be in a position to make inappropriate accounting entries and the risk of bias in
accounting estimates and judgements related to the valuation of claims reserves.
Valuation of these liabilities, especially in respect of the incurred but not reported (IBNR) component, is highly judgmental
as it requires a number of assumptions to be made such as initial expected loss ratios and claim development patterns
all of which carry high estimation uncertainty and are difficult to corroborate creating opportunity for management to
commit fraud.
On this audit we do not believe there is a fraud risk related to revenue recognition because of the limited estimation
involved in accruing premium income. We did not identify any additional fraud risks.
In determining the audit procedures, we took into account the results of our evaluation and testing of certain fraud risk
management controls.
We performed procedures including:
• Identifying potential journal entries to test based on risk criteria and comparing these entries to supporting
documentation. These included entries consisting of unusual double entries to cash accounts or journals posted by
individuals who typically do not make journal entries.
• We assessed the appropriateness and consistency of the methods and assumptions used for reserving. For a selection
of classes of business we considered to be higher risk, we performed alternative projections to the actuarial best
estimate using our own gross loss ratios and compared these to the Syndicate’s results, assessing the results for
evidence of bias.
Identifying and responding to risks of material misstatement related to compliance with laws and regulations
We identified areas of laws and regulations that could reasonably be expected to have a material effect on the
financial information from our general commercial and sector experience, through discussion with the directors
and other management (as required by auditing standards), from inspection of the Managing Agent’s regulatory and
legal correspondence and discussed with the directors and other management the policies and procedures regarding
compliance with laws and regulations.
INDEPENDENT AUDITOR’S REPORT
TO THE MEMBERS OF SYNDICATE 609 CONTINUED
16 / SYNDICATE 609 ANNUAL ACCOUNTS 2025
As the Syndicate is regulated, our assessment of risks involved gaining an understanding of the control environment
including the entity’s procedures for complying with regulatory requirements. We communicated identified laws and
regulations throughout our team and remained alert to any indications of non-compliance throughout the audit.
The potential effect of these laws and regulations on the financial information varies considerably.
Firstly, the Syndicate is subject to laws and regulations that directly affect the financial information including financial
reporting legislation (such as the Insurance Accounts Directive (Lloyd’s Syndicate and Aggregate Accounts) Regulations
2008, and the Lloyd’s Syndicate Accounts Instructions), and we assessed the extent of compliance with these laws and
regulations as part of our procedures on the related financial information items.
Secondly, the Syndicate is subject to many other laws and regulations where the consequences of non-compliance could
have a material effect on amounts or disclosures in the financial information, for instance through the imposition of
fines or litigation or the loss of the Syndicate’s capacity to operate. We identified the following areas as those most likely
to have such an effect: corruption and bribery, compliance with regulations relating to sanctions due to the nature of
the business written by the Syndicate, financial products and services regulation and the Solvency UK regime including
capital requirements, recognising the financial and regulated nature of the Syndicate’s activities.
Auditing standards limit the required audit procedures to identify non-compliance with these laws and regulations
to enquiry of the directors and other management and inspection of regulatory and legal correspondence, if any.
Therefore, if a breach of operational regulations is not disclosed to us or evident from relevant correspondence, an
audit will not detect that breach.
Context of the ability of the audit to detect fraud or breaches of law or regulation
Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some
material misstatements in the financial information, even though we have properly planned and performed our audit
in accordance with auditing standards. For example, the further removed non-compliance with laws and regulations is
from the events and transactions reflected in the financial information, the less likely the inherently limited procedures
required by auditing standards would identify it.
In addition, as with any audit, there remained a higher risk of non-detection of fraud, as fraud may involve collusion,
forgery, intentional omissions, misrepresentations, or the override of internal controls. Our audit procedures are
designed to detect material misstatement. We are not responsible for preventing noncompliance or fraud and cannot be
expected to detect noncompliance with all laws and regulations.
OTHER INFORMATION – REPORT OF THE DIRECTORS OF THE MANAGING AGENT
The Directors are responsible for the Report of the Directors of the Managing Agent. Our opinion on the Syndicate annual
accounts does not cover that report and, accordingly, in this audit report we do not express an audit opinion or, except as
explicitly stated below, any form of assurance conclusion thereon.
Our responsibility is to read the Report of the Directors of the Managing Agent and, in doing so, consider whether, based
on our Syndicate annual accounts audit work, the information therein is materially misstated or inconsistent with the
Syndicate annual accounts or our audit knowledge. Based solely on that work:
• we have not identified material misstatements in the Report of the Directors of the Managing Agent;
• in our opinion the information given in the Report of the Directors of the Managing Agent is consistent with the
Syndicate annual accounts; and
• in our opinion the Report of the Directors of the Managing Agent has been prepared in accordance with the
requirements of the Insurance Accounts Directive (Lloyd’s Syndicate and Aggregate Accounts) Regulations 2008.
MATTERS ON WHICH WE ARE REQUIRED TO REPORT BY EXCEPTION
Under the Insurance Accounts Directive (Lloyd’s Syndicate and Aggregate Accounts) Regulations 2008, we are required to
report to you if, in our opinion:
• adequate accounting records have not been kept on behalf of the Syndicate; or
SYNDICATE 609 ANNUAL ACCOUNTS 2025 / 17
• the Syndicate annual accounts are not in agreement with the accounting records; or
• certain disclosures of Managing Agent’s emoluments specified by law are not made; or
• we have not received all the information and explanations we require for our audit.
We have nothing to report in these respects.
RESPONSIBILITIES OF THE DIRECTORS OF THE MANAGING AGENT
As explained more fully in their statement set out on page 14, the Directors of the Managing Agent are responsible for: the
preparation of the Syndicate annual accounts in accordance with the requirements of the Insurance Accounts Directive
(Lloyd’s Syndicate and Aggregate Accounts) Regulations 2008 and the Syndicate Accounts Instructions, and for being
satisfied that they give a true and fair view; 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; 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 they either intend to cease operations, or have no realistic alternative but to
do so.
AUDITOR’S RESPONSIBILITIES
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 our opinion in an auditor’s report. Reasonable
assurance is a high level of assurance, but does not 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 aggregate, they could reasonably be expected to influence the economic decisions of users
taken on the basis of the Syndicate annual accounts.
A fuller description of our responsibilities is provided on the FRC’s website at www.frc.org.uk/auditorsresponsibilities.
The Directors of the Managing Agent are required, under the Syndicate Accounts Instructions, to include these financial
statements within a document to which XBRL tagging has been applied. This auditor’s report provides no assurance over
whether the XBRL tagged document has been prepared in accordance with those requirements.
THE PURPOSE OF OUR AUDIT WORK AND TO WHOM WE OWE OUR RESPONSIBILITIES
This report is made solely to the Syndicate’s members, as a body, in accordance with the Insurance Accounts Directive
(Lloyd’s Syndicate and Aggregate Accounts) Regulations 2008 and the terms of our engagement letter with the Managing
Agent. Our audit work has been undertaken so that we might state to the Syndicate’s members those matters we are
required to state to them in an auditor’s report, and the further matters we are required to state to them in accordance
with the terms agreed with the Managing Agent, and for no other purpose. To the fullest extent permitted by law, we do
not accept or assume responsibility to anyone other than the Syndicate and the Syndicate’s members, as a body, for our
audit work, for this report, or for the opinions we have formed.
Elizabeth Cox (Senior Statutory Auditor)
for and on behalf of KPMG LLP, Statutory Auditor
Chartered Accountants
15 Canada Square
London
E14 5GL
19 February 2026
INDEPENDENT AUDITOR’S REPORT
TO THE MEMBERS OF SYNDICATE 609 CONTINUED
18 / SYNDICATE 609 ANNUAL ACCOUNTS 2025
STATEMENT OF COMPREHENSIVE INCOME
TECHNICAL ACCOUNT – GENERAL BUSINESS
FOR THE YEAR ENDED 31 DECEMBER 2025
NOTES
£’000
2025
£’000
£’000
2024
£’000
Earned premiums, net of reinsurance
Gross premiums written 5 947,133 1,026,490
Outward reinsurance premiums (295,226 ) (162,915 )
Net premiums written 651,907 863,575
Change in the provision for unearned premiums:
Gross amount (466 ) (24,604 )
Reinsurers’ share (9,803 ) 7,361
Change in the net provision for unearned premiums (10,269 ) (17,243 )
Earned premiums, net of reinsurance 641,638 846,332
Allocated investment return transferred from the non-
technical account
Claims incurred, net of reinsurance
Claims paid:
Gross amount (621,961 ) (363,232 )
Reinsurers’ share 252,397 50,191
Net claims paid (369,564 ) (313,041 )
Change in the provision for claims:
Gross amount 126,141 (292,665 )
Reinsurers’ share 23,810 119,219
Change in the net provision for claims 149,951 (173,446 )
Claims incurred, net of reinsurance (219,613 ) (486,487 )
Net operating expenses 6 (360,336 ) (355,440 )
Balance on the technical account for general business 119,710 63,798
All operations relate to continuing activities.
SYNDICATE 609 ANNUAL ACCOUNTS 2025 / 19
NON-TECHNICAL ACCOUNT – GENERAL BUSINESS
FOR THE YEAR ENDED 31 DECEMBER 2025
NOTES
2025
£’000
2024
£’000
Balance on the general business technical account 119,710 63,798
Investment income 9 36,265 35,024
Realised gains on investments 9 6,210 16,569
Unrealised gains on investments 9 16,253 8,554
Investment expenses and charges 9 (707 ) (754 )
Total investment return 58,021 59,393
Allocated investment return transferred to general business technical account (58,021 ) (59,393 )
Foreign exchange gains/(losses) 2,359 (4,995 )
Profit for the financial year 122,069 58,803
Other comprehensive income
Currency translation differences (5,252 ) 3,167
Total comprehensive income for the year 116,817 61,970
All operations relate to continuing activities.
20 / SYNDICATE 609 ANNUAL ACCOUNTS 2025
BALANCE SHEET:
ASSETS
AT 31 DECEMBER 2025
NOTES | £’000 | 2025 £’000 | £’000 | 2024 £’000 | |
Investments | |||||
| Financial investments | 11 | ||||
| Deposits with ceding undertakings | |||||
Reinsurers' share of technical provisions | |||||
| Provision for unearned premiums | |||||
| Claims outstanding | |||||
Debtors | |||||
| Debtors arising out of direct insurance operations | 12 | | |||
| Debtors arising out of reinsurance operations | 13 | | |||
| Other debtors | 14 | | |||
Other assets | |||||
| Cash at bank and in hand | |||||
Prepayments and accrued income | |||||
| Prepayments and accrued interest | |||||
| Deferred acquisition costs | 15 | | |||
| Total assets |
SYNDICATE 609 ANNUAL ACCOUNTS 2025 / 21
BALANCE SHEET:
LIABILITIES
AT 31 DECEMBER 2025
NOTES | £’000 | 2025 £’000 | £’000 | 2024 £’000 | |
Capital and reserves | |||||
| Members' balances | |||||
Technical provisions | |||||
| Provision for unearned premiums | 17 | | |||
| Claims outstanding | 17 | ||||
Creditors | |||||
| Creditors arising out of direct insurance operations | 18 | | |||
| Creditors arising out of reinsurance operations | 19 | | |||
| Other creditors | 20 | | |||
| Accruals and deferred income | |||||
| Total liabilities | |||||
| Total liabilities, capital and reserves |
The Annual Report and Accounts were approved at a meeting of the Board of Directors of Atrium Underwriters Limited,
on 16 February 2026 and were signed on its behalf by:
Kirsty Steward John Fowle
Agency Finance Director Chief Executive Officer
16 February 2026 16 February 2026
22 / SYNDICATE 609 ANNUAL ACCOUNTS 2025
STATEMENT OF CHANGES IN MEMBERS’ BALANCES
FOR THE YEAR ENDED 31 DECEMBER 2025
2025
£’000
2024
£’000
Members’ balances brought forward at 1 January 154,380 98,356
Profit for the financial year 116,817 61,970
Payments of profit to members’ personal reserve funds (118,651 ) —
Members’ agent fees (3,645 ) (3,547 )
Other (2,133 ) (2,399 )
Members’ balances carried forward at 31 December 146,768 154,380
SYNDICATE 609 ANNUAL ACCOUNTS 2025 / 23
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 122,069 58,803
Increase/(decrease) in gross technical provisions (124,483 ) 323,033
(Increase) in reinsurers' share of gross technical provisions (8,780 ) (128,321 )
Increase in debtors (31,060 ) (59,265 )
Increase in creditors 16,531 35,448
Investment return (58,021 ) (59,393 )
Other (2,383 ) 4,836
Net cash flows from operating activities (86,127 ) 175,141
Cash flows from investing activities
Purchase of debt instruments (588,218 ) (797,165 )
Sale of debt instruments 715,280 638,912
Investment income received 41,768 39,901
Other — —
Net cash flows from investing activities 168,830 (118,352 )
Cash flows from financing activities
Transfer to members in respect of underwriting participations (118,651 ) —
Other 2,734 (5,914 )
Net cash flows from financing activities (115,917 ) (5,914 )
Net increase in cash and cash equivalents (33,214 ) 50,875
Cash and cash equivalents at beginning of financial year 158,932 107,461
Effect of foreign exchange rates on cash and cash equivalents (9,162 ) 596
Cash and cash equivalents at end of financial year 116,556 158,932
Reconciliation to cash at bank and in hand
Cash at bank and in hand at end of financial year 33,225 21,073
Short term deposits with credit institutions 83,331 137,859
Cash and cash equivalents at end of financial year 116,556 158,932
24 / SYNDICATE 609 ANNUAL ACCOUNTS 2025
1. BASIS OF PREPARATION
The syndicate is managed by Atrium Underwriters Limited (AUL) which is incorporated in the United Kingdom. The
address of its registered office is Level 20, 8 Bishopsgate, London, EC2N 4BQ and the company registration number of the
managing agent is 1958863.
The syndicate’s principal activity during the year continued to be the transaction of general insurance and reinsurance
business at Lloyd’s.
These financial statements have been prepared in accordance with the Insurance Accounts Directive (Lloyd’s Syndicate
and Aggregate Accounts) Regulations 2008 and applicable Accounting Standards in the United Kingdom and the Republic
of Ireland, including Financial Reporting Standard 102 (FRS 102). FRS 102 requires the application of Financial Reporting
Standard 103 (FRS 103) in relation to insurance contracts. The financial statements are also prepared in accordance with
Lloyd’s Syndicate Accounts Instructions Version 3.1 as modified by the Frequently Asked Questions Version 1.1 issued by
Lloyd’s.
The financial statements have been prepared on the historical cost basis with the exception of financial assets which are
measured at fair value through profit or loss.
The Directors of the Managing Agent have prepared these financial statements on the basis that the syndicate will
continue to write future business. The ability of the syndicate to meet its obligations as they fall due is underpinned by
the support provided by the Lloyd’s solvency process and its chain of security for any members who are not able to meet
their underwriting liabilities.
Reclassification of comparative information
During 2025 Lloyd’s finalised changes to the syndicate accounts process to rationalise and standardise financial reporting
across the market. As a result, certain comparative information has been reclassified to ensure consistency with current
year presentation and compliance with the Lloyd’s Syndicate Accounts instructions. The changes comprise gross
deferred acquisition costs being disclosed as assets and ceded acquisition costs being disclosed within accruals and
deferred income. Last year deferred acquisition costs were presented net of ceded acquisition costs on the balance sheet.
Additionally, money market funds previously classified as financial investments within the purchases and sales of debt
instruments in the Statement of Cash Flows are now reported as cash equivalents.
The reclassification changes have been applied retrospectively and had no impact on previously reported total
comprehensive income and net assets.
Going Concern
The Directors have performed an assessment of the syndicate’s ability to continue as a going concern, including the
indirect impacts of the war in Ukraine, as detailed in note 2.
The syndicate has a documented Stress & Scenario Testing Framework which sets out the stress, scenario and reverse
stress tests conducted during the year and the governance, reporting and escalation procedures around these. As per its
role the RGOC and Risk Committee have reviewed the tests performed and their results.
The purpose of scenario testing is to assess the financial impact caused by a series of major detrimental events within one
scenario. The total financial impact is then used as a check of the Internal Model’s robustness and the syndicate’s overall
capital adequacy. The scenarios used by management are informed by the syndicate business plan, making them bespoke
to the business. As part of the stress testing work, reverse stress tests were also completed. Reverse stress tests assess
scenarios and circumstances that would render the syndicate’s business model unviable, thereby identifying potential
business vulnerabilities.
The Board’s long term strategy is to support the syndicate in managing the market cycle and providing long term
sustainable returns to capital providers and shareholders, which may include increasing stamp capacity in order to take
advantage of rising rates and new business opportunities. The syndicate continues to take advantage of the current rating
environment by writing increased level of business at higher pricing levels in 2025. The syndicate was able to open the
2026 year of account with stamp capacity of £981.5m and at the current time there is an expectation that the syndicate
will open a 2027 year of account.
NOTES TO THE FINANCIAL STATEMENTS
AT 31 DECEMBER 2025
SYNDICATE 609 ANNUAL ACCOUNTS 2025 / 25
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
As at 31 December 2025, the Board considers that the syndicate has more than adequate liquidity to pay its obligations as
they fall due. The syndicate held cash and cash equivalents of £116.6m and fixed maturity investments with maturity dates
of less than one year of £439.9m.
Based on the going concern assessment performed as at 31 December 2025, the Directors have formed a judgment that
there is a reasonable expectation that the syndicate has adequate resources to continue in operational existence in the
foreseeable future, a period of at least 12 months from the date of signing these financial statements. The 2026 year of
account has opened and based on the Directors assessment that the syndicate has sufficient resources to do so, they have
a reasonable expectation to be in a position to open a 2027 year of account. Accordingly, the Directors continue to adopt
the going concern basis in preparing the annual report and financial statements.
2. USE OF JUDGEMENTS AND ESTIMATES
In preparing these financial statements, the directors of the managing agent have made judgements, estimates and
assumptions that affect the application of the syndicate’s accounting policies and the reported amounts of assets,
liabilities, income and expenses. Actual results may differ from these estimates. Estimates and underlying assumptions are
reviewed on an ongoing basis. Revisions to estimates are recognised prospectively.
The measurement of the provision for claims outstanding involves judgments and assumptions about the future that have
the most significant effect on the amounts recognised in the financial statements.
The provision for claims outstanding comprises the estimated cost of settling all claims incurred but unpaid at the
balance sheet date, whether reported or not. This is a judgemental and complex area due to the subjectivity inherent
in estimating the impact of claims events that have occurred but for which the eventual outcome remains uncertain. In
particular, judgment is applied when estimating the value of amounts that should be provided for claims that have been
incurred at the reporting date but have not yet been reported to the syndicate.
The amount included in respect of IBNR is based on statistical techniques of estimation applied by the in-house actuaries
and reviewed by external consulting actuaries. These techniques generally involve projecting from past experience the
development of claims over time in view of the likely ultimate claims to be experienced and for more recent underwriting,
having regard to variations in business accepted and the underlying terms and conditions. The provision for claims also
includes amounts in respect of internal and external claims handling costs. For the most recent years, where a high
degree of volatility arises from projections, estimates may be based in part on output from rating and other models of
business accepted and assessments of underwriting conditions.
The best estimate reserves include the expected impact of inflationary pressures on the claims. The impact of inflation
is assessed on a class by class basis with reference to available forward looking inflation forecasts and relevant indices as
applicable to each class. The capital setting process for in 2025 took account of future inflationary expectations as well as
the enhanced volatility caused by the potential impact and uncertainties around future tariffs and potential trade barriers.
The syndicate has exposure to the fate of the western leased aircraft in Russia, which predominantly impacts the 2021
year of account. The classes impacted are Aviation War, Aviation Reinsurance and Marine XL. The net ultimate loss is split
2% to the 2020 YOA, 87% to the 2021 YOA and 11% to the 2022 YOA.
At 31 December 2024, a probabilistic approach was taken to deriving the reserving position for this loss, which considered
the financial implications of various scenarios. This approach has continued to be used at 31 December 2025 and the
scenarios and their likelihood continue to rely on judgement, supported by legal advice where appropriate. These
scenarios reflect actual settlements to date as well as the June 2025 judgement in England and Wales in respect of Russian
Aircraft Lessor Policy Claims. Updating the scenarios to reflect the latest information has led to an overall increase in the
estimated ultimate loss assessment with expected ultimate gross claims of £513.0m and £146.2m net of reinsurance as at
31 December 2025 (as at 31 December 2024 - £393.4m gross, £113.8m net of reinsurance).
The situation is complex and continues to develop. The Directors, in conjunction with the relevant subject matter experts,
continue to monitor the situation closely, taking legal advice and meeting with market participants on a regular basis to
1. BASIS OF PREPARATION CONTINUED
26 / SYNDICATE 609 ANNUAL ACCOUNTS 2025
ensure that the most up to date information and appropriate assumptions are reflected within the scenarios applied in
determining the syndicate reserves.
Due to the nature of the underlying circumstances, both in respect of settlement of claims and the associated reinsurance
recoveries, the potential for variation to the booked reserves is considerably greater than the normal level of reserve
sensitivity to risk and the actual outcome of the loss could be in a particularly wide range with greater than usual
variability. As a result, the 2021 year of account will continue to remain open until the level of reserve sensitivity to risk
normalises.
In arriving at the level of claims provisions, a margin is applied over and above the actuarial best estimate so no adverse run-off
deviation is envisaged. Further information about the risk that the provision for claims outstanding could be materially different
from the ultimate cost of claims settlement, is included in note 4.
The calculation of estimated premium income is inherently subjective and attained through underwriters’ best estimates
at a policy level.
3. SIGNIFICANT ACCOUNTING POLICIES
The principal accounting policies applied in the preparation of the syndicate financial statements are set out below. These
policies have been consistently applied to all the years presented, unless otherwise stated.
The areas involving a higher degree or judgement or complexity, or areas where assumptions and estimates are significant
to the financial statements are disclosed in note 2.
Insurance Classification
The syndicate’s contracts are classified at inception, for accounting purposes, as insurance contracts. A contract that is
classified as an insurance contract remains an insurance contract until all rights and obligations are extinguished or expire.
Insurance contracts are those contracts that transfer significant insurance risk, if and only if, an insured event could cause
an insurer to pay significant additional benefits above premiums received and interest earned thereon, excluding scenarios
that lack commercial substance. Such contracts may also transfer financial risk.
Gross Premiums Written
Gross written premiums comprise the total premiums receivable for the whole period of cover under contracts incepting
during the financial year, together with adjustments arising in the financial year to premiums receivable in respect of
business written in previous financial years.
All gross premiums are shown gross of commission payable to intermediaries and are exclusive of taxes and duties levied
thereon.
Unearned Premiums
Written premiums are recognised as earned income over the period of the policy on a time apportionment basis, having
regard, where appropriate, to the incidence of the risk. Unearned premiums represent the proportion of premiums
written that relate to unexpired terms of policies in force at the balance sheet date.
Reinsurance Premium Ceded
Outwards reinsurance premiums are accounted for in the same accounting period as the premiums for the related direct
or inwards business being reinsured.
Claims Provisions and Related Recoveries
Gross claims incurred comprise the estimated cost of all claims occurring during the year, whether reported or not,
including related direct and indirect claims handling costs and adjustments to claims outstanding from previous years.
The provision for claims outstanding is assessed on an individual case basis and is based on the estimated ultimate cost of
all claims notified but not settled by the balance sheet date, together with the provision for related claims handling costs.
The provision also includes the estimated cost of IBNR at the balance sheet date based on statistical methods.
2. USE OF JUDGEMENTS AND ESTIMATES CONTINUED
SYNDICATE 609 ANNUAL ACCOUNTS 2025 / 27
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
These methods generally involve projecting from past experience of the development of claims over time to form a view
of the likely ultimate claims to be experienced for more recent underwriting, having regard to variations in the business
accepted and the underlying terms and conditions. For the most recent years, where a high degree of volatility arises
from projections, estimates may be based in part on output from rating and other models of the business accepted and
assessments of underwriting conditions. The amount of salvage and subrogation recoveries is separately identified and,
where material, reported as an asset.
The reinsurers’ share of provisions for claims is based on the amounts of outstanding claims and projections for IBNR,
net of estimated irrecoverable amounts, having regard to the reinsurance programme in place for the class of business,
the claims experience for the year and the current security rating of the reinsurance companies involved. A number of
statistical methods are used to assist in making these estimates.
The two most critical assumptions as regards claims provisions are that the past is a reasonable predictor of the likely
level of claims development and that the rating and other models used for current business are fair reflections of the
likely level of ultimate claims to be incurred.
The Directors 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, the ultimate liability will vary as a result of subsequent
information and events and this may result in significant adjustments to the amounts provided. Adjustments to the
amounts of claims provisions established in prior years are reflected in the financial statements for the period in which
the adjustments are made. The methods used, and the estimates made, are reviewed regularly.
Deferred Acquisition Costs
Acquisition costs, comprising commission and other costs related to the acquisition of insurance contracts, are deferred
to the extent that they are attributable to premiums unearned at the balance sheet date.
Unexpired Risks Provision
A provision for unexpired risks is made where claims and related expenses arising after the end of the financial period
in respect of contracts concluded before that date, are expected to exceed the unearned premiums and premiums
receivable under these contracts, after the deduction of any acquisition costs deferred. The provision for unexpired
risks is calculated by reference to the classes of business which are managed together, after taking into account relevant
investment returns.
Investment Return
Investment return comprises all investment income, realised investment gains and losses and movements in unrealised gains
and losses, net of investment expenses, charges and interest.
Realised gains and losses on investments are calculated as the difference between sale proceeds and purchase price.
Unrealised gains and losses on investments represents the difference between the valuation at the balance sheet date and
the valuation at the previous balance sheet date, or purchase price, if acquired during the year, together with the reversal of
unrealised gains and losses recognised in earlier accounting periods in respect of investment disposals in the current period.
Investment return is initially recorded in the non-technical account. A transfer is made from the non-technical account
to the general business technical account. Investment return has been wholly allocated to the technical account as all
investments support the underwriting business.
Foreign Currencies
The syndicate’s functional currency is US Dollars, being the primary economic environment in which it operates. The
syndicate’s presentational currency is Sterling.
Transactions in foreign currencies are translated at the average rates of exchange for the period. Assets and liabilities
denominated in foreign currencies are translated at the rate of exchange at the balance sheet date. Differences arising
on translation of foreign currency amounts relating to the insurance operations of the syndicate are included in the
non-technical account.
3. SIGNIFICANT ACCOUNTING POLICIES CONTINUED
28 / SYNDICATE 609 ANNUAL ACCOUNTS 2025
In translating its results and financial position into the presentational currency, the syndicate translates all assets and
liabilities at the closing rates of exchange and translates all income and expense items at average rates, with all resulting
exchange gains and losses being recognised in other comprehensive income.
Financial Instruments
The syndicate has chosen to adopt Sections 11 and 12 of FRS 102 in respect of financial instruments.
Basic financial assets, including deposits with credit institutions, debtors arising out of direct insurance and reinsurance
operations, cash and cash equivalents and other debtors, are initially recognised at transaction price, unless the
arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future
receipts discounted at a market rate of interest. Such assets are subsequently carried at fair value.
Investments are stated at current value at the balance sheet date. For this purpose, listed investments are stated at fair
value and deposits with credit institutions are stated at cost. Unlisted investments for which a market exists are stated at
the average price at which they are traded on the balance sheet date or the last trading day before that date. Any surplus
or deficit on any revaluation is recognised in the non-technical account.
Financial assets are derecognised when (a) the contractual rights to the cash flows from the asset expire or are settled, or
(b) substantially all the risks and rewards of the ownership of the asset are transferred to another party or (c) control of
the asset has been transferred to another party who has the practical ability to unilaterally sell the asset to an unrelated
third party without imposing additional restrictions.
Basic financial liabilities, including creditors arising from insurance operations that are classified as debt, are initially
recognised at transaction price, unless the arrangement constitutes a financing transaction, where the debt instrument is
then measured at the present value of the future receipts discounted at a market rate of interest.
Financial liabilities are derecognised when the liability is extinguished, that is, when the contractual obligation is
discharged, cancelled or expires.
Financial assets and liabilities are off set and the net amounts presented in the financial statements when there is a legally
enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset
and settle the liability, simultaneously.
Fair Value Measurement
The best evidence of fair value is a quoted price for an identical asset in an active market. When quoted prices are
unavailable, the price of a recent transaction for an identical asset provides evidence of fair value as long as there has not
been a significant change in economic circumstances or a significant lapse of time since the transaction took place. If the
market is not active and recent transactions of an identical asset on their own are not a good estimate of fair value, the
syndicate estimates the fair value by using a valuation technique. See note 11 for further information on the syndicate’s
valuation techniques.
At each reporting date the syndicate assesses whether there is objective evidence that financial assets not at fair value
through profit or loss, are impaired. Financial assets are impaired when objective evidence demonstrates that a loss event
has occurred after the initial recognition of an asset, and that the loss event has an impact on the future cash flows on the
asset that can be estimated reliably.
An impairment loss recognised reduces directly the carrying amount of the impaired asset. All impairment losses are
recognised in profit or loss. An impairment loss is reversed if the reversal can be related objectively to an event occurring
after the impairment loss was recognised.
Deposits with Ceding Undertakings
Deposits with ceding undertakings relate to the payment of advance funds by the syndicate under the reinsurance
agreement with LIC into segregated Part VII settlement bank accounts managed by the managing agent on behalf of LIC
3. SIGNIFICANT ACCOUNTING POLICIES CONTINUED
SYNDICATE 609 ANNUAL ACCOUNTS 2025 / 29
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
to settle Part VII claims. Amounts are denominated in multiple currencies, primarily Sterling (GBP), US Dollars (USD) and
Euros (Euro). Deposits with ceding undertakings are measured at cost less allowance for impairment.
Cash and Cash Equivalents
Cash and cash equivalents comprise cash on hand and demand deposits, and other short-term highly liquid investments
that are readily convertible to a known amount of cash and are subject to only an insignificant risk of change in value.
Taxation
Under Schedule 19 of the Finance Act 1993 managing agents are not required to deduct basic rate income tax from trading
income. In addition, all UK basic rate income tax deducted from syndicate investment income is recoverable by managing
agents and consequently the distribution made to members or their members’ agents is gross of tax. Capital appreciation
falls within trading income and is also distributed gross of tax.
No provision has been made for any United States federal income tax payable on underwriting results or investment
earnings. Any payments on account made by the syndicate during the year 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.
Pension Costs
The Atrium Group operates a defined contribution pension scheme. Pension contributions relating to syndicate staff are
charged to the syndicate and included within net operating expenses.
Profit Commission
Profit commission is charged by the managing agent at a rate of 20% of profit subject to the operation of a deficit clause.
Where profit commission is charged it is included within members’ standard personal expenses within administrative
expenses.
4. RISK AND CAPITAL MANAGEMENT
This note presents information about the nature and extent of insurance and financial risks to which the syndicate is
exposed.
Risk Management Framework
The Board has established a Risk Governance Structure in order to ensure that risk is appropriately identified, monitored,
managed and reported across the organisation; to review the activities of the business units; and to ensure that the RMF
is effectively designed, implemented and governed.
The Risk Governance Structure is comprised of the Risk Committee (RC), which fulfils the role of the syndicate’s Risk
Management Function, the Internal Model Governance Committee (IMGC), the Risk Governance & Oversight Committee
(RGOC), and the Risk Sub-Committees.
Insurance Risk Management
The syndicate accepts insurance risk through its insurance contracts where it assumes the risk of loss from persons or
organisations that are directly subject to the underlying loss. The syndicate is exposed to the uncertainty surrounding the
timing, frequency and severity of claims under these contracts. The actual number and value of claims will vary from year
to year and from the level estimated, possibly significantly.
The syndicate manages its risk via its underwriting and reinsurance strategy within an overall risk management
framework. Pricing is based on assumptions which have regard to trends and past experience. Exposures are managed
by having documented underwriting limits and criteria. Reinsurance is purchased to mitigate the effect of potential loss
to the syndicate from individual large or catastrophic events and also to provide access to specialist risks and to assist
in managing capital. Reinsurance policies are written with approved reinsurers on either a proportional or excess of
loss treaty basis. Where an individual exposure is deemed surplus to the syndicate’s risk appetite additional facultative
reinsurance is also purchased.
3. SIGNIFICANT ACCOUNTING POLICIES CONTINUED
30 / SYNDICATE 609 ANNUAL ACCOUNTS 2025
The IRSC oversees the management of reserving risk. The use of proprietary and standardised modelling techniques,
internal and external benchmarking, and the review of claims development are all instrumental in mitigating reserving
risk.
The syndicate’s in-house actuaries perform a reserving analysis on a quarterly basis liaising closely with underwriters,
claims and reinsurance technicians. The aim of this exercise is to produce a probability-weighted average of the expected
future cash outflows arising from the settlement of incurred claims. These projections include an analysis of claims
development compared to the previous ‘best estimate’ projections. The output of the reserving analysis is reviewed by
external consulting actuaries.
The IRSC performs a comprehensive review of the projections, both gross and net of reinsurance. Following this review
the IRSC makes recommendations to the Board of the claims provisions to be established. In arriving at the level of claims
provisions a margin is applied over and above the actuarial best estimate.
Concentration of insurance risk:
A concentration of risk may also arise from a single insurance contract issued to a particular demographic type of
policyholder, within a geographical location or to types of commercial business. The relative variability of the outcome is
mitigated if there is a large portfolio of similar risks.
Assumptions and Sensitivities:
The risks associated with the insurance contracts are complex and subject to a number of variables which complicate
quantitative sensitivity analysis. The syndicate uses several statistical and actuarial techniques based on past claims
development experience. This includes indications such as average claims cost, ultimate claims numbers and expected
loss ratios.
The syndicate considers that the liability for insurance claims recognised in the balance sheet is adequate. However,
actual experience will differ from the expected outcome.
The amount disclosed in the table represents the profit or loss impact of an increase or decrease in the insurance liability
as a result of applying 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 members’ balance.
SENSITIVITY
31 December 2025
+ 5.0%
£’000
– 5.0%
£’000
Claims outstanding – gross of reinsurance (68,929 ) 68,929
Claims outstanding – net of reinsurance (48,969 ) 48,969
SENSITIVITY
+ 5.0%
£’000
– 5.0%
£’000
Claims outstanding – gross of reinsurance
(79,541 ) 79,541
Claims outstanding – net of reinsurance
(59,199 ) 59,199
Financial Risk Management
The syndicate is exposed to financial risk through its financial assets, reinsurance assets and policyholder liabilities.
In particular the key financial risk is that proceeds from, or the valuation of, financial assets are not sufficient to fund
the obligations arising from policies as they fall due. The syndicate monitors and manages the financial risks relating to
the operations of the syndicate through internal risk reports which analyse exposures by degree and magnitude of risks.
These risks include market risk (currency risk, interest rate risk and price risk), credit risk and liquidity risk.
Market risk: Market risk is the risk of adverse financial impact as a consequence of market movements such as currency
exchange rates, interest rates and other price changes. Market risk arises due to fluctuations in both the value of assets
4. RISK AND CAPITAL MANAGEMENT CONTINUED
SYNDICATE 609 ANNUAL ACCOUNTS 2025 / 31
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
held and the value of liabilities. The objective of the syndicate in managing its market risk is to ensure that risk is managed
in line with the syndicate’s risk appetite.
The syndicate has established policies and procedures in order to manage market risk and methods to measure it.
There were no material changes in the syndicate’s market risk exposure in the financial year nor to the objectives, policies
or processes for managing market risk.
Foreign currency risk management
The syndicate undertakes certain transactions denominated in foreign currencies, hence exposures to exchange rate
fluctuations arise.
The syndicate has minimal exposure to currency risk as the syndicate’s financial assets are primarily matched to the same
currencies as its insurance contract liabilities. As a result, foreign exchange risk arises from other recognised assets and
liabilities denominated in other currencies.
The table below summarises the carrying value of the syndicate’s assets and liabilities at the reporting date:
2025
STERLING
£’000
EURO
£’000
US DOLLAR
£’000
CAN DOLLAR
£’000
OTHER
£’000
TOTAL
£’000
Investments 105,928 77,429 810,143 117,563 — 1,111,063
Reinsurer’s share of technical provisions 18,510 12,401 388,358 5,683 — 424,952
Debtors 49,335 23,095 346,307 16,107 — 434,844
Other assets 5,726 7,059 17,947 2,163 330 33,225
Prepayments and accrued interest 32,481 8,380 78,181 12,500 — 131,542
Total assets 211,980 128,364 1,640,936 154,016 330 2,135,626
Technical provisions (209,264 ) (117,042 ) (1,341,819 ) (133,749 ) — (1,801,874 )
Creditors (25,493 ) (2,712 ) (117,877 ) (58 ) (2 ) (146,142 )
Accruals and deferred income (1,431 ) (500 ) (38,433 ) (478 ) — (40,842 )
Total liabilities (236,188 ) (120,254 ) (1,498,129 ) (134,285 ) (2 ) (1,988,858 )
Total capital and reserves 24,208 (8,110 ) (142,807 ) (19,731 ) (328 ) (146,768 )
| 2024 | £’000 | £’000 | £’000 £’000 | £’000 | £’000 | |
| Investments | | | | | | |
| Reinsurers' share of technical provisions | | | | | | |
| Debtors | | | | | | |
| Other assets | | | | | | |
| Prepayments and accrued interest | | | | | | |
| Total assets | | | | | | |
| Technical provisions | ( | ( | ( | ( | | ( |
| Creditors | ( | ( | ( | ( | ( | ( |
| Accruals and deferred income | ( | ( | ( | ( | | ( |
| Total liabilities | ( | ( | ( | ( | ( | ( |
| Total capital and reserves | | ( | ( | ( | ( | |
4. RISK AND CAPITAL MANAGEMENT CONTINUED
32 / SYNDICATE 609 ANNUAL ACCOUNTS 2025
The following table details the syndicate’s sensitivity to a 10% increase and decrease in GBP against USD, Euro and CAD.
For each sensitivity the impact of change in a single factor is shown, with other assumptions unchanged.
IMPACT ON
RESULTS
BEFORE TAX
2025
£’000
IMPACT ON
MEMBERS’
BALANCES
2025
£’000
IMPACT ON
RESULTS
BEFORE TAX
2024
£’000
IMPACT ON
MEMBERS’
BALANCES
2024
£’000
10% increase in GBP/USD exchange rate (14,281) (14,281) (14,283) (14,283)
10% decrease in GBP/USD exchange rate 14,281 14,281 14,283 14,283
10% increase in GBP/Euro exchange rate (811) (811) 85 85
10% decrease in GBP/Euro exchange rate 811 811 (85) (85)
10% increase in GBP/CAD exchange rate (1,973) (1,973) (2,552) (2,552)
10% decrease in GBP/CAD exchange rate 1,973 1,973 2,552 2,552
Interest rate risk management
Interest rate risk is the risk that the value of future cash flows of a financial instrument will fluctuate because of changes
in market interest rates.
Interest rate risk arises primarily from the syndicate’s financial investments, cash and overseas deposits. The risk of
changes in the fair value of these assets is managed by primarily investing in short-duration financial investments and
cash and cash equivalents. The FRSC monitors the duration of these assets on a regular basis. The syndicate has no
significant concentration of interest rate risk. The syndicate manages this risk by adopting close asset/liability matching
criteria, to minimise the impact of mismatches between asset and liability values arising from interest rate movements.
The following table details the syndicate’s sensitivity to a 50 basis point increase and decrease in the yield curves.
For each sensitivity the impact of change in a single factor is shown, with other assumptions unchanged.
IMPACT ON
RESULTS
BEFORE TAX
2025
£’000
IMPACT ON
MEMBERS’
BALANCES
2025
£’000
IMPACT ON
RESULTS
BEFORE TAX
2024
£’000
IMPACT ON
MEMBERS’
BALANCES
2024
£’000
50 basis point increase (10,763 ) (10,763 ) (14,476 ) (14,476 )
50 basis point decrease 10,866 10,866 14,478 14,478
The syndicate’s method for measuring sensitivity to interest rate fluctuations has not changed significantly over the
financial year.
Credit risk: Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in
financial loss to the syndicate. The key areas of exposure to credit risk for the syndicate are in relation to its investment
portfolio, reinsurance programme and amounts due from policyholders and intermediaries.
The objective of the syndicate in managing its credit risk is to ensure risk is managed in line with the syndicate’s risk
appetite. The syndicate has established policies and procedures in order to manage credit risk and methods to measure it.
There were no material changes in the syndicate’s credit risk exposure in the financial year nor to the objectives, policies
and processes for managing credit risk.
The syndicate has adopted a policy of dealing with creditworthy counterparties and obtaining sufficient collateral where
appropriate, as a means of mitigating the risk of financial loss from defaults. The syndicate seeks to transact with entities
that are rated the equivalent to investment grade and above.
This information is supplied by independent rating agencies where available and if not available the syndicate uses other
publicly available financial information and its own trading records to rate its major policyholders and reinsurers.
4. RISK AND CAPITAL MANAGEMENT CONTINUED
SYNDICATE 609 ANNUAL ACCOUNTS 2025 / 33
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
The syndicate’s exposure and the credit ratings of its counterparties are continuously monitored and the aggregate value
of transactions concluded is spread amongst approved counterparties. Credit exposure is controlled by counterparty
limits that are reviewed and approved by the FRSC annually. Furthermore, in certain instances, the syndicate receives
deposits from its reinsurers which it holds under the terms of the reinsurance agreements.
Receivables consist of a large number of policyholders, spread across diverse industries and geographical areas. Ongoing
credit evaluation is performed on the financial condition of accounts receivable.
The syndicate does not have any significant credit risk exposure to any single counterparty or any group of
counterparties. Concentration of credit did not exceed 10% of gross monetary assets at any time during the financial
year. The credit risk on liquid funds is limited because the counterparties are banks with high credit-ratings assigned by
international credit-rating agencies.
The carrying amount of financial assets and reinsurance assets recorded in the financial statements represents the
syndicate’s maximum exposure to credit risk without taking account of the value of any collateral obtained.
The syndicate monitors the credit risk in relation to its investment portfolio and reinsurance programme by monitoring
external credit ratings for the investments and reinsurance assets held by the syndicate on a quarterly basis.
The following table shows aggregated credit risk exposure for assets with external credit ratings. Reinsurance assets are
reinsurers’ share of outstanding claims and IBNR and reinsurance receivables. They are allocated in the table below on the
basis of ratings for claims paying ability.
2025
AAA
£’000
AA
£’000
A
£’000
BBB
£’000
OTHER
£’000
NOT RATED
£’000
TOTAL
£’000
Shares and other variable
yield securities
Debt securities and other
fixed income securities
Loans and deposits with
credit institutions
Syndicate loans to central
fund
Other investments 30,371 14,832 10,863 4,592 2,408 9,235 72,301
Deposits with ceding
undertakings
Reinsurers’ share of claims
outstanding
Debtors arising out of direct
insurance operations
Debtors arising out of
reinsurance operations
Other debtors and accrued
interest
Cash at bank and in hand — — 33,225 — — — 33,225
4. RISK AND CAPITAL MANAGEMENT CONTINUED
34 / SYNDICATE 609 ANNUAL ACCOUNTS 2025
2024
AAA
£’000
AA
£’000
A
£’000
BBB
£’000
OTHER
£’000
NOT RATED
£’000
TOTAL
£’000
Shares and other variable
yield securities
Debt securities and other
fixed income securities
Loans and deposits with
credit institutions
Syndicate loans to central
fund
Other investments 37,630 10,557 9,261 7,277 2,552 8,425 75,702
Deposits with ceding
undertakings
Reinsurers’ share of claims
outstanding
Debtors arising out of direct
insurance operations
Debtors arising out of
reinsurance operations
Other debtors and accrued
interest
Cash at bank and in hand — — 21,073 — — — 21,073
Not rated investments represent cash awaiting investment within our Lloyd’s overseas deposits.
The following tables shows the carrying value of debtors that are neither past due nor impaired, the aging of assets that
are past due but not impaired and assets that have been impaired. The factors considered in determining that the value of
the assets have been impaired were: analysis of impairment, ageing of balances, past loss experience, current economic
conditions and other relevant circumstances.
4. RISK AND CAPITAL MANAGEMENT CONTINUED
SYNDICATE 609 ANNUAL ACCOUNTS 2025 / 35
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
2025
NEITHER
PAST DUE
NOT
IMPAIRED
ASSETS
£’000
PAST DUE
BUT NOT
IMPAIRED
ASSETS
£’000
TOTAL
£’000
Shares and other variable yield securities 138,177 — 138,177
Debt securities and other fixed income securities 898,089 — 898,089
Loans and deposits with credit institutions 15 — 15
Syndicate loans to central fund — — —
Other investments 72,301 — 72,301
Deposits with ceding undertakings 2,481 — 2,481
Reinsurers’ share of claims outstanding 399,192 — 399,192
Debtors arising out of direct insurance operations 392,963 — 392,963
Debtors arising out of reinsurance operations 19,895 18,893 38,788
Other debtors and accrued interest 6,583 — 6,583
Cash at bank and in hand 33,225 — 33,225
2024
NEITHER
PAST DUE
NOR
IMPAIRED
ASSETS
£’000
PAST DUE
BUT NOT
IMPAIRED
ASSETS
£’000
TOTAL
£’000
Shares and other variable yield securities 144,883 — 144,883
Debt securities and other fixed income securities 1,110,119 — 1,110,119
Loans and deposits with credit institutions 16 — 16
Syndicate loans to central fund 7,024 — 7,024
Other investments 75,702 — 75,702
Deposits with ceding undertakings 2,795 — 2,795
Reinsurers’ share of claims outstanding 406,847 — 406,847
Debtors arising out of direct insurance operations 390,409 — 390,409
Debtors arising out of reinsurance operations 24,105 19,351 43,456
Other debtors and accrued interest 5,646 — 5,646
Cash at bank and in hand 21,073 — 21,073
4. RISK AND CAPITAL MANAGEMENT CONTINUED
36 / SYNDICATE 609 ANNUAL ACCOUNTS 2025