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Docusign Envelope ID: CC8F064C-9893-4F57-BFCB-16640029D67F
Polo Managing Agency Limited
Lloyd’s Syndicate 1996
Annual Report and Accounts for the year ended
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2
Contents
Directors and Administration
..........................................................................................................
3
Directors and Administration (continued)
.......................................................................................
4
Managing Agent’s Report
..............................................................................................................
5
Statement of Managing Agent’s Responsibilities
...........................................................................
9
Independent Auditor’s Report to the Member of
Syndicate 1996
................................................
10
Statement of profit or loss and other comprehensive income
.......................................................
14
Balance sheet – Assets
...............................................................................................................
16
Balance sheet (cont’d) – Liabilities
..............................................................................................
17
Statement of changes in members’ balances
..............................................................................
18
Statement of cash flows
..............................................................................................................
18
Notes to the financial statements
.................................................................................................
19
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Directors and Administration
Managing agent
Syndicate 1996. PMA is a wholly owned subsidiary of Marco Capital Holdings (UK) Limited ("MCHL").
Directors
Directors who served at PMA during the year or up until the period the Report & Accounts were signed are as
follows:
P D Andrews - Chief Executive Officer
M J Bishop - Finance Director
I J Bremner - Chair, Non-Executive Director
K D Curtis - Non-Executive Director
J A Hummerston - Director of Underwriting (Resigned 19/02/2025)
P M Laws - Compliance Director (Resigned 26/4/2024)
C E Layton - Director of Underwriting (Appointed 03/01/2025)
S Minshall - Non-Executive Director
R M Richardson-Bunbury - Chief Actuary
M Sebold-Bender
–
Non-Executive Director
P R Smith - Managing Director
Z Szalkai - Non-Executive Director
P I Wooldridge - Chief Operations Officer
Company Secretary
P M Laws (Appointed 26/4/2024)
Managing agent’s registered office
'Grange Park'
Bishop's Cleeve
Cheltenham
Gloucestershire
United Kingdom
GL52 8YQ
Managing agent’s registered number
03935227
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Directors and Administration (continued)
Syndicate
Active Underwriter
S Jefferys
Bankers
Barclays Bank - London
1 Churchill Place
London
E14 5HP
Independent Auditors
PKF Littlejohn LLP
–
statutory auditor
15 Westferry Circus
Canary Wharf
London
E14 4HD
Statement of actuarial opinion signing actuary
PKF Littlejohn LLP
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Managing Agent’s Report
The Directors of PMA, the Managing Agent, present their report for Syndicate 1996 ("the Syndicate") for the
year ended 31 December 2024.
Principal activities
The principal activity of Syndicate 1996 is the underwriting of Property Insurance in the Lloyd’s market.
Review of the business
As at 31 December 2024, Syndicate 1996 is declaring a loss of £0.1m (2023: £0.8m loss).
The Syndicate solely underwrites wildfire exposed commercial property in California, for a broad range of
occupancies. Business is currently accepted by the syndicate via a binding authority, with Wildfire Defense
Insurance Services, Inc (“WDIS”) a Lloyd’s approved coverholder.
The Syndicate is in its second underwriting year and is still developing the book, written volumes are increasing
but strict underwriting discipline is being maintained. Low net earned premium at the end of the year, is largely
driven by reinsurance costs affecting the technical result, contributing to the calendar year loss.
As the
syndicate grows, the reinsurance cost will have a lesser impact on the financial results.
Claims activity has been very low during this calendar year with claims paid of £0.1m contributing to net incurred
losses being £0.7m, well below expectations due to strong underwriting performance on the 2023 year of
account.
Syndicate 1996 continues to reserve using expected loss ratios, apart from when there is objective
evidence supporting a change in approach.
Net operating expenses of £4.4m include £0.4m payments to the Wildfire Defense Systems, Inc. (“WDS”)
response service; calculated as 5% of gross premium earned. The well-established WDS response service
provides wildfire mitigation and loss intervention services in 22 states.
The Syndicate has presented its results under FRS102, the Financial Reporting Standard applicable in the UK
and Republic of Ireland. In accordance with FRS102, the Syndicate has identified its insurance contracts and
accounted for them in accordance with FRS103 Insurance Contracts (United Kingdom Generally Accepted
Accounting Practice).
Review of underwriting activities for 2024
The table below summarises the premium volumes and performance of the Syndicate for 2024.
Key performance indicators
2024
2023
£m
£m
Gross premiums written
10.8
2.7
Net premiums earned
5.1
0.3
(Loss) for the year
(0.1)
(0.8)
Principal risks and uncertainties
The Managing Agent sets the Syndicate's risk appetite annually, which is approved as part of the Syndicate’s
business planning process. The PMA Risk Committee meets at least quarterly to oversee the risk management
framework, which includes the review of the risk profile as reflected in the risk register, and monitoring
performance against risk appetite using a series of key risk indicators. The principal risk and uncertainties facing
the Syndicate are as follows:
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Insurance risk
Insurance risk includes the risk that a policy will be written for too low a premium or provide inappropriate cover
(underwriting risk), that the frequency or severity of insured events will be higher than expected (claims risk), or
that estimates of claims subsequently prove to be insufficient (reserving risk). The Syndicate manages
insurance risk through the approved business plan, which sets out targets for volumes, pricing, line sizes and
retention by class of business. The Syndicate monitors performance against the business plan through the year
and reviews pricing on an ongoing basis depending on market conditions. Reserve adequacy is monitored
through quarterly review by the PMA Actuarial team and Syndicate Management Committee ("SMC"), which
meets quarterly.
Credit risk
The key aspect of credit risk is reinsurance counterparty risk, which is the risk of default by one or more of the
Syndicate’s reinsurers and intermediaries. The Syndicate’s policy is that it will only reinsure with approved
reinsurers, supported by collateralisation where required. All reinsurers have an S&P or AM Best rating of A- or
above.
Market risk
Market risk exposure impacting the Syndicate relates to fluctuations in interest rates or exchange rates. The
Syndicate is exposed to foreign exchange movements as a result of mismatches between the currencies in
which assets and liabilities are denominated. The syndicates functional currency is USD.
The Agency’s policy is to maintain received income or incurred expenditure in the core currencies in which they
were received or paid. Any surplus or deficit in the functional currency would be subject to review by the SMC.
Liquidity risk
This is the risk that the Syndicate will not be able to meet its liabilities as they fall due owing to a shortfall in
cash or can only meet obligations at excessive cost. To mitigate this risk the Syndicate reviews cash flow
projections regularly and ensures that, where needed, the Syndicate has liquidity facilities in place or could
utilise the option of a cash call from capital providers.
The Syndicate has benefitted from a loan facility in place with WDS, one of its capital providers to support it
with operational expenses during the startup phase.
Operational risk
This is the risk that errors caused by people, processes, systems and external events lead to losses to the
Syndicate. The Managing Agent seeks to manage this risk through the use of an operational risk and control
framework, detailed procedures manual, thorough training programme and a structured programme of testing
of processes and systems by internal audit. Business continuity and disaster recovery plans are in place and
are regularly updated and tested.
Regulatory risk
Regulatory risk is the risk of loss owing to a breach of regulatory requirements or failure to respond to regulatory
change. The Managing Agent is required to comply with the requirements of the Financial Conduct Authority
("FCA"), Prudential Regulation Authority ("PRA") and Lloyd’s. Lloyd’s requirements include those imposed on
the Lloyd’s market by overseas regulators, particularly in respect of US situs business. A Compliance Officer
manages the function that monitors business activity and regulatory developments to assess any effects on the
Managing Agent.
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Capital
Lloyd's unique capital structure provides excellent financial security for policyholders:
•
All premiums received are initially held in trust.
•
Funds at Lloyd's (“FAL”) provide a layer of capital that can be called upon to pay liabilities. The FAL
requirement is set by Lloyd's standard model for new syndicates, until their Internal Model is approved.
Syndicate 1996 does not have its own security rating; however, it does benefit from Lloyd’s global A (Excellent)
rating from A.M. Best, AA- (Very Strong) rating from Standard and Poor’s, and AA- (Very Strong) from Fitch.
Future developments
The Syndicate will continue to transact the current class of insurance business, seeking growth where
underwriting criteria. If opportunities arise to write new classes of business, these will be investigated at the
appropriate time.
Environmental, Social and Governance ("ESG")
The Syndicate is aligned to Wildfire Defense companies which follow an environmental professional services
model that aligns with wildfire as an evolving environmental impact. Wildfire Defense companies work as a
system to support ESG goals with respect to achieving a significant reduction of wildfire loss.
Keeping carbon from being released into the environment is a major strategic goal for leading insurance
companies, reinsurance companies and syndicates. Lloyd's continues with a clear net-zero commitment for the
Corporation and a commitment to lead the market to a net-zero underwriting position through the championing
of new products and services which accelerate these targets. Wildfire Defense companies and the Syndicate
play a key strategic role in the achievement of that long-term objective for Lloyd’s.
The syndicate is uniquely positioned to facilitate the transfer of wildfire risk exacerbated by climate change. As
climate change leads to an increase in wildfires, the demand for protection against such events will rise. As a
specialist provider of wildfire related insurance products Wildfire Defense Insurance Services, Inc. has launched
a dedicated wildfire only product, which is being written in the syndicate. Supported by Wildfire Defense
Systems' fire response and risk mitigation services, this syndicate is well-equipped to offer both insurance
coverage and physical risk protection.
Other performance indicators
Staff matters
The managing agent considers its staff to be a key resource and seeks to provide a good working environment
for its staff that is rewarding and safe and complies with appropriate employee legislation. During the year there
have been no significant injuries to staff in the workplace nor any significant actions taken by any regulatory
bodies with regard to staff matters.
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Directors’ Interests
None of the Directors of the Managing Agent have any participation in the Syndicate’s premium income capacity.
Directors who served at PMA during the year or up until the period the Report & Accounts were signed are
detailed in the 'Directors and Administration' section on page 3.
Directors and Officers
Details of the Directors and Officers of the Managing Agent that were serving at the year end and up to the date
of signing of the financial statements are provided on page 3. Changes to directors and officers from the last
report were as follows:
P M Laws - Compliance Director (Resigned 26/4/2024)
P M Laws
–
Company Secretary (Appointed 26/4/2024)
C E Layton - Director of Underwriting (Appointed 03/01/2025)
J A Hummerston - Director of Underwriting (Resigned 19/02/2025)
Syndicate Annual General Meeting
The Managing Agent does not propose to hold an annual general meeting for the members of the Syndicate.
The members are asked to note that any objections to this proposal should be submitted, in writing, to the Risk
& Compliance Director within 21 days of this notice.
Auditors
The Managing Agent intends to reappoint PKF Littlejohn as the Syndicate’s auditors
.
Disclosure of information to auditors
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 preparing its
report, of which the auditor is unaware. 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.
Approved by order of the Board of Directors and signed on its behalf:
M J Bishop
Finance Director
6
th
March 2025
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Statement of Managing Agent’s Responsibilities
The managing agent is responsible for preparing the Syndicate annual report and financial statements in
accordance with applicable law and United Kingdom Generally Accepted Accounting Practice.
The Insurance Accounts Directive (Lloyd’s Syndicate and Aggregate Accounts) Regulations 2008 (‘the 2008
Regulations’) require the Managing Agent to prepare syndicate annual accounts for each financial year. Under
that law the Managing Agent has elected to prepare the financial statements in accordance with United Kingdom
Accounting Standards, including FRS 102 “The Financial Reporting Standard applicable in the UK and Republic
of Ireland” , FRS 103 “Insurance Contracts” (United Kingdom Generally Accepted Accounting Practice) and the
Lloyd’s Syndicate Accounts Instructions Version 2.0 as modified by the Frequently Asked Questions Version 1.1
issued by Lloyd’s. Under company law the managing agent must not approve the financial statements unless
they are satisfied that they give a true and fair view of the state of affairs of the Syndicate and of the profit or
loss of the Syndicate for that period.
In preparing those Syndicate financial statements, the Managing Agent is required to:
1.
select suitable accounting policies which are applied consistently, subject to changes arising on the
adoption of new accounting standards in the year;
2.
make judgements and estimates that are reasonable and prudent;
3.
state whether applicable accounting standards have been followed, subject to any material departures
disclosed and explained in the financial statements;
4.
prepare the annual accounts on the basis that the Syndicate will continue to write future business and
administer claims, using the going concern basis of accounting, where appropriate; and
5.
The preparation and review of the iXBRL tagging that has been applied to the Syndicate Financial
Statements
in accordance with the instructions issued by Lloyd’s, including designing, implementing
and maintaining systems, processes and internal controls to result in tagging that is free from material
non-
compliance with the instructions issued by Lloyd’s, wheth
er due to error.
The Managing Agent is responsible for keeping proper accounting records which disclose with reasonable
accuracy at any time the financial position of the Syndicate and enable it to ensure that the Syndicate financial
statements comply with the 2008 Regulations.
It is also responsible for safeguarding the assets of the Syndicate
and hence for taking reasonable steps for prevention and detection of fraud and other irregularities.
Legislation in the UK governing the preparation and dissemination of financial statements may differ from
legislation in other jurisdictions.
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Independent Auditor’s Report to the Members’ of
Syndicate 1996
Opinion
We have audited the Annual Financial Statements of Syndicate 1996 (the ‘Syndicate’) for the year ended 31
December 2024 which comprise the Statement of Profit or Loss and Other Comprehensive Income, the Balance
Sheet, the Statement of Changes in Members’ Balances, the Statement of Cash Flows and Notes to the
Financial Statements, including significant accounting policies. The financial reporting framework that has been
applied in their preparation is applicable law and United Kingdom Accounting Standards, including FRS 102
The Financial Reporting Standard applicable in the UK and Republic of Ireland
and FRS 103
Insurance
Contracts
(United Kingdom Generally Accepted Accounting Practice).
In our opinion, the financial statements:
•
give a true and fair view of the state of the Syndicate’s affairs as at 31 December 2024 and of its loss
for the year then ended;
•
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting
Practice; and
•
have been prepared in accordance with the requirements of the Insurance Accounts Directive (Lloyd’s
Syndicate and Aggregate Accounts) Regulations 2008 and the requirements within Lloyd’s Syndicate
Accounts Instructions Version 2.0 as modified by the Frequently Asked Questions Version 1.1 issued
by Lloyd’s (the “Lloyd’s Syndicate Accounts Instructions”).
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)), The Insurance
Accounts Directive (Lloyd’s Syndicate and Aggregate Accounts) Regulations 2008, the Lloyd’s Syndicate
Accounts
Instructions
and other applicable law. Our responsibilities under those standards are further described
in the Auditor’s responsibilities for the audit of the financial statements section of our report. We are independent
of the Syndicate in accordance with the ethical requirements that are relevant to our audit of the financial
statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical
responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is
sufficient and appropriate to provide a basis for our opinion.
Other Matter
This report may be included within a document to which iXBRL tagging has been applied. This auditors’ report
provides no assurance over whether the iXBRL tagging has been applied in accordance with the Lloyd’s
Syndicate Accounts Instructions.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the managing agent’s use of the going concern
basis of accounting in the preparation of the financial statements is appropriate.
Based upon the work we have performed, we have not identified any material uncertainties relating to events
or conditions that, individually or collectively, may cast significant doubt on the Syndicate’s ability to continue as
a going concern for a period of at least twelve months from when the financial statements are authorised for
issue.
Our responsibilities and the responsibilities of the managing agent with respect to going concern are described
in the relevant sections of this report.
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Other information
The other information comprises the information included in the Syndicate annual report and accounts, other
than the financial statements and our auditor’s report thereon.
The managing agent is responsible for the other information contained within the Syndicate annual report. Our
opinion on the financial statements does not cover the other information and, except to the extent otherwise
explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility
is to read the other information and, in doing so, consider whether the other information is materially inconsistent
with the financial statements, or our knowledge obtained in the course of the audit, or otherwise appears to be
materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are
required to determine whether this gives rise to a material misstatement in the financial statements themselves.
If, based on the work we have performed, we conclude that there is a material misstatement of this other
information, we are required to report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the Insurance Accounts Directive (Lloyd’s Syndicate and
Aggregate Accounts) Regulations 2008
In our opinion, based on the work undertaken in the course of the audit:
•
the information given in the managing agent’s report for the financial year for which the Syndicate
Annual Financial Statements are prepared is consistent with the Syndicate Annual Financial
Statements; and
•
the managing agent’s report has been prepared in accordance with applicable legal requirements.
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the Syndicate and its environment obtained in the course of
the audit, we have not identified material misstatements in the managing agent’s report.
We have nothing to report in respect of the following matters in relation to which the Insurance Accounts
Directive (Lloyd’s Syndicate and Aggregate Accounts) Regulations 2008 requires us to report to you if, in our
opinion:
•
adequate accounting records have not been kept on behalf of the Syndicate; or
•
the Syndicate Annual Financial Statements are not in agreement with the accounting records and
returns; or
•
certain disclosures of managing agent emoluments and other benefits specified by law are not made;
or
•
we have not received all the information and explanations we require for our audit.
Responsibilities of the managing agent
As explained more fully in the statement of managing agent’s responsibilities, the managing agent is responsible
for the preparation of the Syndicate Annual Financial Statements and for being satisfied that they give a true
and fair view and for such internal control as the managing agent determines is necessary to enable the
preparation of Syndicate Annual Financial Statements that are free from material misstatement, whether due to
fraud or error.
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In preparing the Syndicate Annual Financial Statements, the managing agent is responsible for assessing the
Syndicate’s ability to continue to write new business, disclosing, as applicable, matters related to its ability to
continue to operate and using the going concern basis of accounting, unless the managing agent intends to
cease to operate the Syndicate or has no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the syndicate annual financial statements
Our objectives are to obtain reasonable assurance about whether the Syndicate Annual Financial Statements
as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report
that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an
audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they
could reasonably be expected to influence the economic decisions of users taken on the basis of these
Syndicate Annual Financial Statements.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures
in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities,
including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is
detailed below:
•
We updated an understanding of the Syndicate and the insurance sector in which it operates to identify
laws and regulations that could reasonably be expected to have a direct effect on the Syndicate Annual
Financial Statements such as The Insurance Accounts Directive (Lloyd’s Syndicate and Aggregate
Accounts) Regulations 2008 and the Lloyd’s Syndicate Accounts Instructions. We updated our
understanding in this regard through discussions with management, industry research and the application
of our cumulative audit knowledge and experience of the insurance sector.
•
We determined the principal laws and regulations relevant to the Syndicate in this regard to be those arising
from the Financial Conduct Authority (FCA), the Prudential Regulation Authority (PRA), Lloyd’s of London
and the Insurance Accounts Directive (Lloyd’s Syndicates and Aggregate Accounts) Regulations 2008, and
the financial reporting framework (UK GAAP).
•
We designed our audit procedures to ensure the audit team considered whether there were any indications
of non-compliance by the Syndicate with those laws and regulations. These procedures included, but were
not limited to:
o
agreement of the Syndicate Annual Financial Statements disclosures to underlying supporting
documentation;
o
enquiries of management and review of minutes of Board and management committee meetings
throughout the period;
o
understanding the Syndicate’s policies and procedures in monitoring compliance with laws and
regulations;
o
inspection of correspondence with Lloyd’s, the PRA and FCA; and
o
reviewing internal audit reports relating to the Syndicate.
•
We also identified possible risks of material misstatement of the Annual Financial Statements due to fraud;
in particular:
o
We considered that there is a rebuttable presumption that there is a significant fraud risk over revenue
recognition. We did not consider fraud over the accuracy of revenue to be a significant risk for
transactions that have been processed during the period as there is no area of judgement or subjectivity
with respect to revenue.
o
We considered that there was potential for management bias in the reporting of events and transactions
in the Annual Financial Statements relating to the seasonality adjustment factor applied to earning
patters, valuation of technical provisions and the calculation of the reinsurer’s share of technical
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13
provisions. To address the risk of fraud with respect to the seasonality adjustment, we challenged the
assumptions and judgements made by management in deriving at the seasonality adjustments. With
respect to the valuation of technical provisions and the reinsurer’s share, we involved actuarial
specialists to assist us in challenging the assumptions and judgements made by management and
performing an independent reprojection of the 2023 year of account reserves.
o
As in all of our audits, we addressed the risk of fraud arising from management override of controls by
performing audit procedures which included, but were not limited to, the testing of journals and reviewing
accounting estimates for evidence of bias and evaluating the business rationale of any significant
transactions that are unusual or outside the normal course of business.
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including
those leading to a material misstatement in the Syndicate Annual Financial Statements or non-compliance with
laws and regulations. This risk increases the more that compliance with a law or regulation is removed from the
events and transactions reflected in the Syndicate Annual Financial Statements, as we will be less likely to
become aware of instances of non-compliance. This risk is also greater regarding irregularities occurring due
to fraud rather than error, as fraud involves intentional concealment, forgery, conclusion, omission or
misrepresentation.
A further description of our responsibilities for the audit of the Syndicate Annual Financial Statements is located
on the Financial Reporting Council’s website at:
www.frc.org.uk/auditorsresponsibilities
. This description forms
part of our auditor’s report.
Use of our report
This report is made solely to the Syndicate’s members, as a body, in accordance with Part 2 of the Insurance
Accounts Directive (Lloyd’s Syndicate and Aggregate Accounts) Regulations 2008.
Our audit work has been
undertaken so that we might state to the Syndicate’s members those matters we are required to state to them
in an auditor’s report and for no other purpose.
To the fullest extent permitted by law, we do not accept or
assume responsibility to anyone, other than the Syndicate and the Syndicate's members as a body, for our audit
work, for this report, or for the opinions we have formed.
Cheryl Mason
15 Westferry Circus
For and on behalf of PKF Littlejohn LLP
Canary Wharf
Statutory Auditor
London E14 4HD
6
th
March 2025
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14
Statement of profit or loss and other comprehensive income
Technical account – General business
For the year ended 31 December 2024
Note
2024
£000
2023
£000
£000
£000
Gross premiums written
5
Outwards reinsurance premiums
(2,804 )
(1,935 )
Premiums written, net of reinsurance
Changes in unearned premium
15
Change in the gross provision for unearned premiums
(2,292 )
(1,997 )
Change in the provision for unearned premiums reinsurers’
share
(677 )
Net change in provisions for unearned premiums
(2,970 )
(529 )
Earned premiums, net of reinsurance
Allocated investment return transferred from the non-technical
account
10
Claims paid
15
Gross amount
(149 )
Net claims paid
(149 )
Change in the provision for claims
15
Gross amount
(764 )
(143 )
Reinsurers’ share
Net change in provisions for claims
(562 )
(97 )
Claims incurred, net of reinsurance
(711 )
(97 )
Net operating expenses
6
(4,443 )
(1,006 )
Balance on the technical account
–
general business
(72 )
(846 )
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Statement of profit or loss and other comprehensive income (cont.)
Non-technical account – General business
For the year ended 31 December 2024
Note
2024
2023
£000
£000
Balance on the technical account
–
general business
(72 )
(846 )
Investment income
9
Unrealised gains on investments
9
Total investment return
Allocated investment return transferred to the general business
technical account
(30 )
(3 )
Loss on foreign exchange
(13 )
(13 )
Loss for the financial year
(85 )
(859 )
Other comprehensive income:
Currency translation (loss)/gain
(15 )
Total comprehensive loss for the year
(100 )
(839 )
The accompanying notes from page 19 to 39 form an integral part of these financial statements.
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Balance sheet – Assets
As at 31 December 2024
Note
2024
2023
£000
£000
Financial investments
Investments
10
Provision for unearned premiums
Claims outstanding
Reinsurers’ share of technical provisions
15
Debtors arising out of direct insurance operations
11
Other debtors
12
Debtors
Cash at bank and in hand
18
Other
Other Assets
Deferred acquisition costs
13
Other prepayments and accrued income
Prepayments and accrued income
Total assets
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17
Balance sheet (cont’d) – Liabilities
As at 31 December 2024
Note
2024
2023
£000
£000
Members’ balances
(1,068 )
(898 )
Total Capital and reserves
(1,068
(898
Provision for unearned premiums
Claims outstanding
Technical provisions
15
Creditors arising out of reinsurance operations
16
Other creditors including taxation and social security
17
Creditors
Accruals and deferred income
Total liabilities
Total liabilities, Capital and reserves
The Syndicate financial statements on pages 14 to 39 were approved by the board of Directors of Polo
Managing Agency Limited on 6
th
March 2025 and were signed on its behalf by:
M J Bishop
Finance Director
6
th
March 2025
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Statement of changes in members’ balances
For the year ended 31 December 2024
2024
2023
£000
£000
Members’ balances brought forward at 1 January
(898 )
Total recognised losses for the year
(100 )
(839 )
Members agent fees
(70 )
(59 )
Members’ balances carried forward at 31 December
(1,068 )
(898 )
Statement of cash flows
For the year ended 31 December 2024
Note
2024
2023
£000
£000
Cash flows from operating activities
Loss for the financial year
(85 )
(859 )
Adjustments:
Increase in gross technical provisions
Decrease/(in
crease) in reinsurers’ share of gross technical provisions
(1,478 )
Increase in debtors
(315 )
(886 )
Increase in creditors*
Movement in other assets/(liabilities)
(717 )
(488 )
Investment return
(30 )
(3 )
Foreign exchange
(15 )
Other
(8 )
Net cash flows from operating activities
(803 )
Cash flows from investing activities
Purchase of equity and debt instruments
(1,267 )
Investment income received
Net cash flows from investing activities
(1,237 )
Cash flows from financing activities
Loan proceeds*
1,102
1,612
Loan repayments
(1,549)
-
Other cash flows from financing activities
(447 )
Net cash flows from financing activities
(447 )
Net increase in cash and cash equivalents
Cash and cash equivalents at the beginning of the year
Foreign exchange on cash and cash equivalents
Cash and cash equivalents at the end of the year
18
*
Loan proceeds of £1.6m previously included in increase in creditors have now been disclosed in financing activities.
The accompanying notes from page 19 to 39 form an integral part of these financial statement.
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19
Notes to the financial statements
1. Basis of preparation
Syndicate 1996
(‘The Syndicate’) comprises a group of members of the Society of Lloyd's that underwrites
insurance business in the London Market. The address of the Syndicate’s managing agent is
shown in the
Directors and Administration section on page 3.
The 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. Additionally,
the Lloyd’s Syndicate Accounts Instructions Version 2.0 as modified by the Frequen
tly Asked Questions Version
1.1 issued by Lloyd’s
has been used as a guide in preparing these financial statement.
The financial statements have been prepared on the historical cost basis, except for financial assets at fair value
through profit or loss.
The financial statements are presented in Pounds Sterling, the functional currency of the Syndicate is US Dollars
which is the currency of the primary economic environment in which the syndicate operates.
All amounts have been rounded to the nearest thousand, unless otherwise indicated.
Reclassification
Within the cashflow statement loan proceeds of £1.6m previously included in increase in creditors have now
been disclosed in financing activities.
Going concern
The Syndicate has financial resources to meet its financial needs and manage its portfolio of insurance risk.
The directors have continued to review the business plans, liquidity and operational resilience of the Syndicate
and are satisfied that the Syndicate is well positioned to manage its business risks in the current economic
environment. The Syndicate has sufficient capital
in its Funds at Lloyd’s (“
FAL
”
). There is no intention to cease
underwriting or cease the operations of the Syndicate.
Accordingly, the directors of the Managing Agent continue to adopt the going concern basis in preparing the
annual report and financial statements.
2.
Use of judgements and estimates
In preparing these financial statements, the directors of the Managing Agent have made judgements, estimates
and assumptions that affect the application of the Syndicate’s accounting policies and the reported amounts of
assets, liabilities, income and expenses.
The following critical judgements have been made in applying the Syndicate’s accounting policies:
The Syndicate makes estimates and assumptions concerning the future. The resulting accounting estimates
will, by definition, seldom equal the related actual results. The estimates and assumptions that have a significant
risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial
year are addressed below.
The accounting policy for technical provisions is described on pages 20 and 21 and the related risks are
described within the Risk Management section
. The net technical provisions after the reinsurers’ share
are
£4.2m (2023: £0.6m).
The most uncertain element within these technical provisions is the amount for gross claims outstanding, which
covers amounts where there has not yet been a notification. This amounted to £0.9m gross of reinsurance
(2023: £0.1m). As described in the Risk Management section there is a thorough review process of reserving
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20
estimates, including detailed actuarial evaluation of past claims development. There is however, a risk that past
performance may not be a good indicator of the future developments.
Earnings are calculated on the basis of seasonality adjusted factors that reflect the nature of the risk occurring
throughout the year. These factors been derived using publicly available data on historic wildfires specifically
the acreage of wildfires and the number of structures damaged (adjusted for the % damage). The relative
contribution of claims from catastrophe, attritional and large event were considered in deriving the adjustment.
3. Significant accounting policies
The following significant accounting policies have been applied consistently in dealing with items which are
considered material in relation to the Syndicate’s financial statements.
A. Premiums written
Gross premiums written reflect direct business written during the period, gross of commission payable to
intermediaries, and exclude any taxes or duties based on premiums.
B. Unearned premiums
The provision for unearned premiums comprises the proportion of gross premiums written which is estimated
to be earned in the following or subsequent financial periods. Written premium is earned according to the risk
profile of the policy. Unearned premiums represent the proportion of premiums written in the year that relate to
unexpired terms of policies in force at the balance sheet date, calculated on the basis of established earnings
patterns based on seasonality and time apportionment, as appropriate.
C. Acquisition costs
Costs incurred in acquiring general insurance contracts are deferred. Acquisition costs include direct costs such
as brokerage and commission, and indirect costs such as administrative expenses connected with the
processing of proposals and the issuing of policies. The deferred acquisition cost asset represents the
proportion of acquisition costs which corresponds to the proportion of gross premiums written that is unearned
at the balance sheet date.
D. Reinsurance
The Syndicate cedes reinsurance in the normal course of business. Reinsurance premiums ceded and
reinsurance recoveries on claims incurred are included in the respective expense and income accounts.
Premiums ceded and claims reimbursed are presented on a gross basis in the technical account and balance
sheet as appropriate.
Reinsurance outwards premiums are earned according to the coverage period and in line with the risk profile to
which the inwards business being protected relates (i.e. seasonality).
Reinstatement premiums on both inwards and outwards business are accreted to the technical account on a
pro-rata basis over the term of the original policy to which they relate.
E.
Claims provisions and related reinsurance recoveries
Claims incurred comprise claims and claims handling expenses (both internal and external) paid in the year and
the movement in provision for outstanding claims and settlement expenses. The Syndicate does not discount
its liability for outstanding claims nor the reinsurance share of outstanding claims.
Outstanding claims include an allowance for the cost of claims incurred by the balance sheet date but not
reported until after the year end (IBNR). The liability for outstanding claims is estimated using the input of
assessments for individual cases reported to the Syndicate and widely accepted actuarial techniques for the
claims incurred but not reported (IBNR). The amount included in respect of IBNR is based on statistical
techniques of estimation applied by actuaries. These techniques generally involve projecting using Lloyd's
market statistics, 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
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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 the business accepted
and assessments of underwriting conditions. An element of IBNR also relates to specific large losses, such as
catastrophe events where applicable.
The reinsurers’ share of provisions for claims is based on calculated 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 techniques are used to assist in making these
estimates.
Reinsurance assets are assessed for impairment at each balance sheet date. A reinsurance asset is deemed
impaired if there is objective evidence, as a result of an event that occurred after its initial recognition, that the
Syndicate may not recover all amounts due, and that event has a reliably measurable impact on the amount
that the Syndicate will receive from the reinsurer. Impairment losses are recognised in profit or loss in the period
in which the impairment loss is recognised.
F.
Unexpired risks provision
Provision is made for unexpired risks arising from general insurance contracts where the expected value of
claims and expenses attributable to the unexpired periods of policies in force at the balance sheet date exceeds
the unearned premiums provision in relation to such policies (after the deduction of any deferred acquisition
costs). The provision for unexpired risks is calculated by reference to classes of business which are managed
together. No unexpired risk provision has been made at the Balance Sheet date.
G. Foreign currencies
The Syndicate financial statements are presented in Pounds Sterling (the presentation currency) and rounded
to thousands.
The functional currency of the Syndicate is US Dollars, which is the currency of the primary economic
environment in which the Syndicate operates.
Foreign currency transactions are translated into the functional currency using the exchange rate at the date of
transaction.
At each period end, foreign currency monetary items are translated using the closing rate. For this purpose, all
assets and liabilities arising from insurance contracts (including unearned premiums, deferred acquisition costs,
and unexpired risk provisions) are monetary items.
Monetary items - Foreign exchange gains and losses resulting from the settlement of transactions and from the
translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies
are recognised in the non-technical account.
Non-monetary items measured at historical cost and non-monetary items measured at fair value are measured
using the exchange rate when the fair value was determined.
The functional currency amounts are translated into the presentation currency as follows:
• assets and liabilities are translated at the closing rate at the balance sheet date;
• income and expenses are translated at the average rate of exchange during the year; and
• all resulting exchange differences are recognised in other comprehensive income.
H.
Financial assets and liabilities
The full provisions of FRS 102 have been applied to the treatment of financial instruments. The accounting
classification of financial assets and liabilities determines their basis of measurement and how changes in those
values are presented in the profit or loss or other comprehensive income. These classifications are made at
initial recognition, and subsequent reclassification is only permitted in restricted circumstances.
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i.
Classification
The accounting classification of financial assets and liabilities determines the way in which they are measured
and changes in those values are presented in the statement of profit or loss and other comprehensive income.
Financial assets and liabilities are classified on their initial recognition.
The initial classification of a financial instrument shall take into account contractual terms including those relating
to future variations. Once the classification of a financial instrument is determined at initial recognition,
re-assessment is only required subsequently when there has been a modification of contractual terms that is
relevant to an assessment of the classification.
Financial assets and financial liabilities at fair value through profit and loss comprise financial assets and
financial liabilities designated as such on initial recognition. Investments in shares and other variable yield
securities, units in unit trusts, and debt and other fixed income securities are designated as at fair value through
profit or loss on initial recognition, as they are managed on a fair value basis in accordance with the Syndicate’s
investment strategy.
The Syndicate does not hold any derivatives.
ii.
Recognition
Financial instruments are recognised when the Syndicate becomes a party to the contractual provisions of the
instrument. Financial assets are
derecognised if the Syndicate’s contractual rights to the cash flows from the
financial assets expire or if the Syndicate transfers the financial asset to another party without retaining control
of substantially all risks and rewards of the asset. A financial liability is derecognised when its contractual
obligations are discharged, cancelled or expired.
Purchases and sales of financial assets are recognised and derecognised, as applicable, on the trade date, i.e.
the date that the Syndicate commits itself to purchase or sell the asset.
iii.
Measurement
A financial asset or financial liability is measured initially at fair value plus, for a financial asset or financial liability
not at fair value through profit or loss, transaction costs that are directly attributable to its acquisition or issue.
Subsequently, financial assets at fair value through profit or loss are measured at fair value with fair value
changes recognised immediately in profit or loss. Net gains or net losses on financial assets measured at fair
value through profit or loss includes foreign exchange gains/losses arising on their translation to the functional
currency but excludes interest.
Impairment losses and foreign exchange gains or losses are reported in profit or loss. Other fair value changes
are recognised in other comprehensive income
(“OCI”)
. Any gain or loss recognised in OCI will be recycled to
profit and loss on derecognition of the asset.
Loans and receivables and non-derivative financial liabilities are measured at amortised amortised cost using
the effective interest method.
iv.
Identification and measurement of impairment
At each reporting date the Syndicate assesses whether there is objective evidence that financial assets not at
fair value through profit or loss are impaired. Financial assets are impaired when objective evidence
demonstrates that a loss event has occurred after the initial recognition of an asset, and that the loss event has
an impact on the future cash flows on the asset that can be estimated reliably.
Objective evidence that financial assets are impaired includes observable data that comes to the attention of
the Syndicate about any significant financial difficulty of the issuer, or significant changes in the technological,
market, economic or legal environment in which the issuer operates.
Objective evidence that a financial asset or group of assets is impaired includes:
•
significant financial difficulty of the issuer or obligor;
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•
a breach of contract, such as a default or delinquency in interest or principal payments;
•
the Syndicate, for economic or legal reasons relating to the debtor’s financial difficulty, granting to the
debtor a concession that would not otherwise be considered;
•
it has become probable that the debtor will enter bankruptcy or other financial reorganisation; and
•
observable data indicating that there has been a measurable decrease in the estimated future cash flows
from a group of financial assets since the initial recognition of those assets, even though the decrease
cannot yet be identified with the individual financial assets in the group, such as adverse national or local
economic conditions or adverse changes in industry conditions.
An impairment loss in respect of a financial asset measured at amortised cost is calculated as the difference
between the
carrying amount, and the present value of the estimated future cash flows discounted at the asset’s
original effective interest rate. Individually significant financial assets are tested for impairment on an individual
basis. The remaining financial assets are assessed collectively in groups that share similar credit risk
characteristics.
v.
Off-setting
Debtors/creditors arising from reinsurance operations shown in the balance sheet include the totals of all
outstanding debit and credit transactions as processed by the Lloyd’s central facility. No account has been taken
of any offsets which may be applicable in calculating the net amounts due between the Syndicate and each of
its counterparty insureds, reinsurers or intermediaries as appropriate.
Financial assets and financial liabilities are offset, and the net amount presented in the balance sheet when,
and only when, the Syndicate has a legal right to set off the amounts and intends either to settle on a net basis
or to realise the asset and settle the liability simultaneously.
I.
Investment return
Investment return comprises interest income and movements in gains and losses on financial instruments at
fair value through profit or loss, less investment management expenses, interest expense, realised losses and
impairment losses.
Movements in unrealised investment gains and losses comprise the increase/decrease in the reporting period
in the value of the investments held at the reporting date and the reversal of previously recorded unrealised
investment gains.
Investment return is initially recorded in the non-technical account. The return is transferred in full to the general
business technical account to reflect the investment return on funds supporting underwriting business.
J.
Cash and cash equivalents
Cash and cash equivalents comprise cash balances and call deposits with maturities of three months or less
from the acquisition date that are subject to an insignificant risk of changes in fair value and are used by the
Syndicate in the management of its short-term commitments.
Cash and cash equivalents are carried at amortised cost in the statement of financial position.
Bank overdrafts that are repayable on demand and form an integral part of the Syndicate’s cash management
are included as a component of cash and cash equivalents for the purpose of the statement of cash flows.
K. Taxation
Under Schedule 19 of the Finance Act 1993 managing agents are not required to deduct basic rate income tax
from trading income. In addition, all UK basic rate income tax (currently at 25%) 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.
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No provision has been made for any United States Federal Income Tax payable on underwriting results or
investment earnings. Any payments on account made by the Syndicate during the year have been included in
the balance sheet under the heading ‘other debtors’.
No provision has been made for any other overseas tax payable by members on underwriting results.
L. Pension costs
No pension costs are directly borne by the Syndicate.
M. Operating expenses
Where expenses are incurred by the Managing Agent for the administration of the Syndicate, these expenses
are apportioned appropriately based on type of expense, and allocated to the year of account for which they
are incurred.
N. Prepayments and accrued income
Prepayments are payments made in advance for services to be received in future periods. These are initially
recognised as assets in the balance sheet and are amortised over the period to which they relate. The expense
is recognised in the income statement as the benefits are received.
Accrued income represents income that has been earned but not yet received by the end of the accounting
period. This is recognised as an asset in the balance sheet and the corresponding investment income is
recorded in the income statement for the period in which it is earned.
O. Debtors and creditors
Insurance debtors and creditors include amounts due to and from agents, brokers and insurance contract
holders. Reinsurance debtors and creditors include amounts due to and from reinsurers. These are classified
as debt instruments as they are non-derivative financial assets with fixed or determinable payments that are not
quoted on an active market. Insurance and reinsurance debtors are measured at amortised cost less any
provision for impairments. Insurance and reinsurance creditors are stated at amortised cost. The Syndicate
does not have any debtors directly with policyholders, all transactions occur via an intermediary. Reinsurance
creditors are primarily premiums payable for reinsurance contracts and are recognised as an expense when
due. Reinsurance debtors principally relate to claims recoveries where the underlying claim has been settled,
and the recovery is due.
Other debtors principally consist of amounts due from members and sundry debtors and are carried at amortised
cost less any impairment losses.
Other creditors principally consist of amounts due to other related entities and other sundry payables. These
are stated at amortised cost determined using the effective interest rate method.
P.
Classification of insurance and reinsurance contracts
Insurance and reinsurance contracts are classified as insurance contracts where they transfer significant
insurance risk. If a contract does not transfer significant insurance risk it is classified as a financial instrument.
All of the Syndicates written contracts and purchased reinsurance contracts transfer significant insurance risk
and therefore are recognised as insurance contracts.
4.
Risk and capital management
Introduction and overview
This note presents information about the nature and extent of insurance and financial risks to which the
Syndicate is exposed, the Managing Agent’s objectives, policies and processes for measuring and managing
insurance and financial risks, and for
managing the Syndicate’s capital.
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Risk management framework
The Syndicate’s activities
expose it to a variety of financial and non-financial risks. In order to achieve its
business plan and objectives, the Syndicate recognises that it is necessary to take risk and expects to be
rewarded for doing so. The Syndicate is also exposed to several unrewarded risks as a function of its operating
model, such as operational risk. The Managing Agent is responsible for understanding and managing the
syndicate’s exposure to such risks and does this through the deployment of its enterprise risk management
(“ERM”) framework.
The ERM framework includes an annual review and setting of risk appetites for the Syndicate as a part of the
syndicate business planning (when applicable) and capital setting process. The Risk Management Function
regularly assess the risks to which the Syndicate is exposed, and where deemed necessary, ensures that
controls and procedures are in place to mitigate the effects of such risks to an acceptable level. The Risk
Committee meets regularly to monitor performance against the approved risk appetites using a set of key risk
indicators and provide oversight and challenge to ensure the Syndicate operates within a robust control
environment.
The Board of Directors of the Managing Agent has overall responsibility for the establishment and oversight of
the Syndicate’s risk management framework. The Board has established a Risk Committee to oversee the
operation of the Syndicate’s risk management
framework and to review and monitor the management of the
risks to which the Syndicate is exposed. The Managing Agent's risk management framework includes processes
such as, the annual review and approval of risk appetites for the Syndicate as part of the Syndicate's Own Risk
and Solvency Assessment ("ORSA") and capital setting process.
In addition to, risk and control assessment,
regular risk appetite monitoring, risk incident root cause analysis, emerging risk horizon scanning and risk
management reporting.
The SMC assess the risk exposure associated with running the syndicate. These risks include Insurance,
Market, Credit and Liquidity. Operational risks generally fall under the Risk Committee. The SMC recommends
risks and appetite for approval by the Risk Committee. The Syndicate adopts the risk policies of the Managing
Agent.
The risk management policies are established to identify and analyse the risks faced by the Syndicate, to set
appropriate risk limits and controls, and to monitor risks and adherence to limits.
A. Insurance risk
Insurance risk refers to fluctuations in the timing, frequency and severity of insured events, relative to the
expectations of the syndicate
at the time of underwriting. The very nature of the syndicate’s business exposes
it to the likelihood that claims will arise from business written. Insurance risk is the principal risk the syndicate
faces and arises from the inherent uncertainties in the occurrence, amount and timing of insurance liabilities.
The key components of insurance risk are underwriting & pricing risk. Each element is considered below.
i. Underwriting risk
The risk that losses are higher than planned, due to fluctuations in market conditions and the timing, frequency
and severity of insured events, including as a result of climate risk manifestations, or failings in the underwriting
process. Underwriting at the Syndicate is solely through binding authorities written to the Wildfire Defense
owned Managing General Agent ("MGA"), WDIS. As this is ‘delegated authority’ business, it is subject to the
Managing Agent’s robust coverholder and binder due diligence process and continues to be monitored closely,
according to the Delegated Authority Framework.
Insurance risk is further mitigated, in respect of wildfire exposures, by the extensive experience of the Wildfire
Defense companies, who provide extensive technical data to support the risk selection and pricing of the
portfolio. Furthermore, in the event of a wildfire event, Wildfire Defense resources are deployed to defend
threatened insured properties wherever possible.
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ii. Reserve Risk
Reserving risk is the risk of exposure to the financial consequences of material uncertainty in ultimate claim
payments and expenses.
This risk is mitigated by the Syndicate's Actuarial function using external expertise and recognised actuarial
reserving approaches, coupled with close liaison with claims personnel to identify potential downside risks
before they become apparent in the data. These results are then subject to formal annual external peer review,
the result of which is a Statement of Actuarial Opinion over the held reserves being at least as high as a mean
best estimate. The s
tatement is provided annually to Lloyd’s.
The governance process supporting Syndicate reserving is applied through the SMC, reporting to the Audit
Committee, which is responsible for approving Syndicate reserves quarterly, as delegated by the PMA Board.
The level of booked reserves is subject to an external audit annually.
Claim estimates are sensitive to the actual rate of claims development. If the Syndicate's rate of claim
development is faster than the market, standard methods would overestimate future claims. Conversely, if the
Syndicate's rate of claim development is slower than the market, standard methods would underestimate future
claims. Consideration
is given to Lloyd’s risk code data from the
Lloyd’s Market Association
(“
LMA
”)
where PMA
uses risk code triangles to produce development patterns. The provision for claims also includes amounts in
respect of internal and external claims handling costs.
i.
Management of insurance risk
Insurance risk includes the risks that a policy will be written for too low a premium or provide inappropriate cover
(underwriting risk), that the frequency or severity of insured events will be higher than expected (claims risk), or
that estimates of claims subsequently prove to be insufficient (reserving risk). The Syndicate manages
insurance risk through the approved business plan, which sets out targets for volumes, pricing, line sizes and
retention by class of business. The Syndicate monitors performance against the business plan through the year
and reviews pricing on an ongoing basis depending on market conditions. Reserve adequacy is monitored
through quarterly review by the PMA Actuarial team and SMC, which meets quarterly.
The Syndicate makes use of reinsurance to mitigate the risk of incurring significant losses. To protect against
material insurance losses, the Syndicate has bought two standard reinsurance programmes. The first, a risk
excess of loss which will respond in the event of individual risk losses and the second, a catastrophe
programme, which responds to an event impacting more than one insured risk.
Both programmes have been placed with well rated reinsurers. All reinsurers have an S&P or AM Best rating of
A- or above, in line with the agreed reinsurance strategy.
The SMC 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
Managing Agent’s 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.
For 2024 year
of account the critical estimate is the loss ratio derived from the SBF. For 2023 the critical estimate is the choice
of pattern used to estimate the development of the class in order to apply the Bornhuetter-Ferguson method.
The output of the reserving analysis is reviewed by external consulting actuaries. The Audit Committee performs
a comprehensive review of the projections, both gross and net of reinsurance. Following this review the Audit
Committee
makes recommendations to the Managing Agent’s Board of Directors
of the claims provisions to be
established.
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ii.
Sensitivity to insurance risk
The liabilities established could be significantly lower or higher than the ultimate cost of settling the claims
arising. This level of uncertainty varies the risk being underwritten and can arise from developments in case
reserving for large losses and catastrophes, or from changes in estimates of claims IBNR.
The following table presents the sensitivity of the value of insurance liabilities disclosed in the accounts to
potential movements in the assumptions applied within the technical provisions applying a 5%
increase/decrease to loss reserves.
General insurance business sensitivities as at 31 December 2024
+5.0%
-5.0%
£000
£000
Claims outstanding
–
gross of reinsurance
46
(46)
Claims outstanding
–
net of reinsurance
34
(34)
General insurance business sensitivities as at 31 December 2023
+5.0%
-5.0%
£000
£000
Claims outstanding
–
gross of reinsurance
7
(7)
Claims outstanding
–
net of reinsurance
5
(5)
B. Financial risk
The focus of financial risk management for the Syndicate is ensuring that the proceeds from its financial assets
are sufficient to fund the obligations arising from its insurance contracts. The goal of the investment
management process is to optimise the risk adjusted investment income and risk adjusted total return by
investing in a diversified portfolio of securities, whilst ensuring that the assets and liabilities are managed on a
cash flow and duration matching basis.
a. Credit risk
The key aspect of credit risk is reinsurance counterparty risk which is the risk of default by one or more of the
Syndicate’s reinsurers and intermediaries
. This can also include the risk of financial loss to the Syndicate if a
counterparty fails to discharge a contractual obligation.
The Syndicate is exposed to credit risk in respect of the following:
•
Reinsurers: Whereby reinsurers may fail to pay valid claims against a reinsurance contract held by the
Syndicate.
•
Broker and intermediary: Whereby counterparties fail to pass on premiums collected or claims paid on
behalf of the Syndicate.
•
Investments: Whereby issuer default results in the Syndicate losing all or part of the value of a financial
instrument.
The Syndicate has a very low appetite for credit risk, as its principal business is to accept insurance risk. This
approach is intended to protect the Syndicate’s capital from erosion from credit risk so that it can meet its
insurance liabilities.
i.
Management of credit risk
The Syndicate’s credit risk in respect of debt securities is managed by placing limits on its exposure to a single
counterparty, by reference to the credit rating of the counterparty. Financial assets are graded according to
current credit ratings issued by rating agencies such
as Standard and Poor’s.
The Syndicate has a policy of
investing mainly in government issued and government backed debts.
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The Syndicate assesses the creditworthiness of all reinsurers by reviewing public rating information and by
internal investigations. The impact of reinsurer default is regularly assessed and managed accordingly.
ii.
Exposure to credit risk
The carrying amount of financial assets and reinsurance assets represents the maximum credit risk exposure.
The following table analyses the credit rating by investment grade of financial investments, debt securities and
reinsurers’ share of claims outstanding, amount due from intermediaries, amounts due from reinsurers in
respect of settled claims, cash and cash equivalents, and other debtors and accrued interest.
As at 31 December 2024
AAA
AA
A
BBB
Other
Not
rated
Total
£000
£000
£000
£000
£000
£000
£000
Debt securities and other fixed income securities
-
1,264
-
-
-
-
1,264
Other investments
3
1
-
-
-
-
4
Reinsurers’ share of claims outstanding
-
15
238
-
-
-
253
Debtors arising out of direct insurance operations
-
-
-
-
-
1,034
1,034
Cash at bank and in hand
-
-
2,195
-
-
-
2,195
Other debtors and accrued interest
-
-
-
-
37
37
Total
3
1,280
2,433
-
-
1,071
4,787
As at 31 December 2023
AAA
AA
A
BBB
Other
Not
rated
Total
£000
£000
£000
£000
£000
£000
£000
Debt securities and other fixed income securities
-
-
-
-
-
-
-
Reinsurers’ share of claims outstanding
-
3
42
-
-
-
45
Debtors arising out of direct insurance operations
-
-
-
-
-
793
793
Cash at bank and in hand
-
-
812
-
-
-
812
Other debtors and accrued interest
-
-
-
-
-
34
34
Total
-
3
854
-
-
827
1,684
iii.
Financial assets that are past due or impaired
The Syndicate does not have debtors arising from direct insurance that are past due but not impaired at the
reporting date.
b.
Liquidity risk
Liquidity risk is the risk that the Syndicate will encounter difficulty in meeting obligations arising from its
insurance contracts and financial liabilities. The Syndicate is exposed to calls on its available cash resources
mainly from claims arising from insurance contracts.
The nature of the Syndicate’s exposures to liquidity risk and its objectives, policies and processes for managing
liquidity risk have not changed significantly from the prior year.
i.
Management of liquidity risk
The Syndicate’s approach to managing liquidity risk is to ensure, as far as possible, that it will always have
sufficient liquidity to meet its liabilities when they fall due, under both normal and stressed conditions.
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The Syndicate’s approach to managing its liquidity risk is as follows:
•
Forecasts are prepared and revised on a regular basis to predict cash outflows from insurance contracts
over the short, medium and long term;
•
Assets purchased by the Syndicate are required to satisfy specified investment management guidelines;
•
The Syndicate maintains cash and liquid assets to meet daily calls on its insurance contracts;
•
The Syndicate holds uncommitted borrowing facilities from a highly rated bank to enable cash to be raised
in a relatively short time span in addition to a loan from a related party; and
•
The Syndicate regularly updates its contingency funding plans to ensure that adequate liquid financial
resources are in place to meet obligations as they fall due in the event of reasonably foreseeable abnormal
circumstances.
The Syndicate has benefitted from a loan facility in place with WDS, one of its capital providers to support it
with operational expenses during the startup phase. A £2.8m loan facility was agreed, in order to provide an
additional layer of liquidity. During the year this was reduced to a £1.6m loan facility and £1.2m is outstanding
at the year end.
There is also a £1.5m multicurrency overdraft in place, in addition to a £8m trade cycle loan, both of which
remain undrawn.
ii.
Maturity analysis of syndicate liabilities
The maturity analysis presented in the table below shows the remaining contractual maturities for the
Syndicate’s insurance contracts and financial instruments. For insurance
contracts, the contractual maturity is
the estimated date when the gross undiscounted contractually required cash flows will occur. For financial
liabilities, it is the earliest date on which the gross undiscounted cash flows (including contractual interest
payments) could be paid assuming conditions are consistent with those at the reporting date.
Undiscounted net cash flows
As at 31 December 2024
No maturity
stated
0-1 yrs
1-3 yrs
3-5 yrs
>5 yrs
Total
£000
£000
£000
£000
£000
£000
Claims outstanding
-
413
454
40
17
924
Creditors
-
2,523
-
-
-
2,523
Total
-
2,936
454
40
17
3,447
Undiscounted net cash flows
As at 31 December 2023
No maturity
stated
0-1 yrs
1-3 yrs
3-5 yrs
>5 yrs
Total
£000
£000
£000
£000
£000
£000
Claims outstanding
-
53
78
6
2
139
Creditors
-
707
1,664
-
-
2,371
Total
-
760
1,742
6
2
2,510
c. Market risk
Market risk is the risk that the fair value or future cash flows of a financial instrument or insurance contract will
fluctuate because of changes in market prices. Market risk comprises three types of risk: interest rate risk,
currency risk and other price risk.
The objective of market risk management is to manage and control market risk exposures within acceptable
parameters, while optimising the return on risk. The nature of the Syndicate exposures to market risk and its
objectives, policies and processes for managing market risk have not changed significantly from the prior year.
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Management of market risks
For each of the major components of market risk the Syndicate has policies and procedures in place which
detail how each risk should be managed and monitored. The management of each of these major components
of major risk and the exposure of the Syndicate at the reporting date to each major risk are addressed below.
i.
Interest rate risk
Interest rate risk is the risk that the fair value and/or future cash flows of a financial instrument will fluctuate
because of changes in interest rates.
The Syndicate is exposed to interest rate risk through its investment portfolio, borrowings and cash and cash
equivalents.
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 SMC monitors the duration of these assets on a regular basis,
targeting an investment portfolio duration that, in the event of changes in interest rates, always maintains the
internal liquidity requirements.
ii.
Currency risk
The table below
summarises the carrying value of the Syndicate’s assets and
liabilities, at the reporting date:
As at 31 December Year 2024
GBP
US $
Total
£000
£000
£000
Investments
-
1,264
1,264
Overseas Deposits
-
4
4
Reinsurers' share of technical provisions
-
1,016
1,016
Debtors
8
1,063
1,071
Other assets and deferred acquisition costs
100
3,177
3,277
Prepayments and accrued income
174
320
494
Total assets
282
6,844
7,126
Technical provisions
-
(5,253)
(5,253)
Creditors
-
(2,523)
(2,523)
Accruals and deferred income
(223)
(195)
(418)
Total liabilities
(223)
(7,971)
(8,194)
Total Capital and reserves
59
(1,127)
(1,068)
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As at 31 December Year 2023
GBP
US $
Total
£000
£000
£000
Investments
-
-
-
Reinsurers' share of technical provisions
-
1,478
1,478
Debtors
13
814
827
Other assets and deferred acquisition costs
11
1,289
1,300
Prepayments and accrued income
44
142
186
Total assets
68
3,723
3,791
Technical provisions
-
(2,089)
(2,089)
Creditors
-
(2,371)
(2,371)
Accruals and deferred income
(193)
(36)
(229)
Total liabilities
(193)
(4,496)
(4,689)
Total Capital and reserves
(125)
(773)
(898)
iii.
Sensitivity analysis to market risks
The analysis below is performed for reasonably possible movements in market indices on financial instruments
with all other variables held constant, showing the impact on the result before tax due to changes in fair value
of financial assets and liabilitie
s (whose fair values are recorded in the profit and loss account) and members’
balances.
2024
2024
2023
2023
Impact on
results
Impact on
members'
balances
Impact on
results
Impact on
members'
balances
£000
£000
£000
£000
Interest rate risk
+ 50 basis points shift in yield curves
6
6
-
-
- 50 basis points shift in yield curves
(6)
(6)
-
-
d. Capital management
i.
Capital framework at Lloyd’s
The Society of Lloyd’s (Lloyd’s) is a regulated undertaking and subject to the supervision of the PRA under the
Financial Services and Markets Act 2000 and in accordance with Solvency II requirements.
Within this supervisory framework, Lloyd’s applies capital requirements at member level and centrally to ensure
that Lloyd’s would comply with the Solvency II requirements, and beyond that to meet its own financial strength,
licence and ratings objectives.
Although, as described below, Lloyd’s capital setting processes use a capital requirement set at syndicate level
as a starting point, the requirement to meet Solvency II and Lloyd’s capital requirements apply at overall and
member level only respectively, not at syndicate level. Accordingly, the capital requirement in respect of
Syndicate 1996 is not disclosed in these financial statements.
ii.
Lloyd’s capital setting process
In order to meet Lloyd’s requirements, each Syndicate is required to calculate its Solvency Capital Requirement
(
“
SCR
”
) for the prospective underwriting year. This amount must be sufficient to cover a 1 in 200-year loss,
reflecting uncertainty in the ultimate run off of underwriting liabilities (SCR ‘to ultimate’). The Syndicate must
also calculate its SCR at the same confidence level but reflecting uncertainty over a one year time horizon (one
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year SCR) for Lloyd’s to use in meeting Solvency II requirements. The SCRs of each
syndicate are subject to
review by Lloyd’s and approval by the Lloyd’s Capital and Planning Group.
A syndicate may be comprised of one or more underwriting members of Lloyd’s. Each member is liable for its
own share of underwriting liabilities on the Syndicates on which it is participating but not other members’ shares.
Accordingly, the capital requirem
ents that Lloyd’s sets for each member operates on a similar basis.
Each member’s SCR shall thus be determined by the sum of the member’s share of the Syndicate SCR ‘to
ultimate’. Where a member participates on more than one syndicate, a credit for diversification is provided to
reflect the spread of risk, but consistent with determining an SCR which reflects the capital requirement to cover
a 1 in 200 loss ‘to ultimate’ for that member. Over and above this, Lloyd’s applies a capital uplift to the member’s
capital requirement, known as the Economic Capital Assessment (
“
ECA
”
). The purpose of this uplift, which is a
Lloyd’s not a Solvency II requirement, is to meet Lloyd’s financial strength, licence and ratings
objectives. The
capital uplift applied for 2024 was 35% (2024: 35%) of the member’s SCR ‘to ultimate’.
iii.
Provision of capital by members
Each member may provide capital
to meet its ECA either by assets held in trust by Lloyd’s specifically for that
member (FAL), assets held and managed within a syndicate (FIS), or as the member’s share of the members’
balances on each syndicate on which it participates.
5.
Analysis of underwriting result
An analysis of the underwriting result before investment return is presented in the table below
Year 2024
Gross
premiums
written
Gross
premiums
earned
Gross
claims
incurred
Gross
operating
expenses
Reinsurance
balance
Underwriting
result
£000
£000
£000
£000
£000
£000
Direct insurance
Fire and other damage
to property
10,825
8,533
(913)
(4,443)
(3,279)
(102)
Total direct insurance
10,825
8,533
(913)
(4,443)
(3,279)
(102)
Total
10,825
8,533
(913)
(4,443)
(3,279)
(102)
Year 2023
Gross
premiums
written
Gross
premiums
earned
Gross
claims
incurred
Gross
operating
expenses
Reinsurance
balance
Underwriting
result
£000
£000
£000
£000
£000
£000
Direct insurance
Fire and other damage
to property
2,718
721
(143)
(1,006)
(421)
(849)
Total direct insurance
2,718
721
(143)
(1,006)
(421)
(849)
Total
2,718
721
(143)
(1,006)
(421)
(849)
No gains or losses were recognised in profit or loss during the year on buying reinsurance.
The gross premiums written for direct insurance by underwriting location of risk is presented in the table below:
2024
2023
£000
£000
UK
10,825
2,718
Total gross premiums written
10,825
2,718
All protected risks are located in California, USA.
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6. Net operating expenses
2024
2023
£000
£000
Acquisition costs
2,707
680
Change in deferred acquisition costs
(573)
(500)
Administrative expenses
1,468
480
Members’ standard personal expenses
841
346
Net operating expenses
4,443
1,006
Total commissions for direct insurance business for the year amounted to:
2024
2023
£000
£000
Total commission for direct insurance business
2,707
680
Administrative expenses include:
2024
2023
£000
£000
Auditors’ remuneration:
fees payable to the Syndicate’s
auditor for the audit of these financial statements
97
55
fees payable to the Syndicate’s auditor and its associates in respect of other services
pursuant to legislation
39
25
7.
Key management personnel compensation
No emoluments of the directors of PMA were directly charged to the Syndicate and consequently no meaningful
disclosure can be made.
No staff of PMA were directly charged to the Syndicate. The emoluments of the Active Underwriter are borne
by the Syndicate.
2024
2023
£000
£000
Emoluments
–
Active Underwriter
194
59
No other compensation was payable to key management personnel.
8.
Staff numbers and costs
The Syndicate and Managing Agent have no employees. Staff costs are not charged directly to the syndicate
and consequently no meaningful disclosure can be made.
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9. Investment return
2024
2023
£000
£000
Interest and similar income
From financial instruments designated at fair value through profit or loss
Interest and similar income
28
3
Other income from investments
From financial instruments designated at fair value through profit or loss
Unrealised gains on investments
2
-
Total investment return
30
3
Transferred to the technical account from the non-technical account
30
3
An investment return of £30k was wholly allocated to the technical account.
10. Financial investments
Carrying value
Cost
2024
£000
2023
£000
2024
£000
2023
£000
Debt securities and other fixed income securities
1,264
-
1,262
-
Total financial investments
1,264
-
1,262
-
The table below presents an analysis of financial investments by their measurement classification.
2024
£000
2023
£000
Financial assets measured at fair value through profit or loss
1,264
-
Total financial investments
1,264
-
The Syndicate classifies its financial instruments held at fair value in its balance sheet using a fair value
hierarchy based on the inputs used in the valuation techniques as follows:
•
Level 1
–
financial assets that are measured by reference to published quotes in an active market. A
financial instrument is regarded as quoted in an active market if quoted prices are readily and regularly
available from an exchange, dealer, broker, industry group, pricing service or regulatory agency and those
prices represent actual and regularly occurring market transactions on an arm’s length basis.
•
Level 2
–
financial assets measured using a valuation technique based on assumptions that are supported
by prices from observable current market transactions. For example, assets for which pricing is obtained
via pricing services but where prices have not been determined in an active market, financial assets with
fair values based on broker quotes, investments in private equity funds with fair values obtained via fund
managers and assets that are valued using the Syndicate’s own models whereby the significa
nt inputs into
the assumptions are market observable.
•
Level 3
–
financial assets measured using a valuation technique (model) based on assumptions that are
neither supported by prices from observable current market transactions in the same instrument nor are
they based on available market data. Therefore, unobservable inputs reflect the Syndicate's own
assumptions about the assumptions that market participants would use in pricing the asset or liability
(including assumptions about risk). These inputs are developed based on the best information available,
whic
h might include the Syndicate’s own data.
The table below analyses financial instruments held at fair value in the Syndicate’s balance sheet at the
reporting date by its level in the fair value hierarchy.
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As at 31 December 2024
Level 1
£000
Level 2
£000
Level 3
£000
Assets
held at
amortised
cost
Total
£000
Debt securities and other fixed income securities
1,264
-
-
-
1,264
Total financial investments
1,264
-
-
-
1,264
No investments were held by the syndicate in the year ending 31 December 2023.
11. Debtors arising out of direct insurance operations
2024
2023
£000
£000
Amounts due within one year
1,034
793
Total
1,034
793
12. Other debtors
2024
2023
£000
£000
Other
37
34
Total
37
34
Other debtors include a claims float and input VAT.
13. Deferred acquisition costs
The table below shows changes in deferred acquisition costs assets from the beginning of the period to the
end of the period.
2024
2023
Gross
Net
Gross
Net
£000
£000
£000
£000
Balance at 1 January
488
488
-
-
Incurred deferred acquisition costs
2,707
2,707
680
680
Amortised deferred acquisition costs
(2,134)
(2,134)
(180)
(180)
Foreign exchange movements
21
21
(12)
(12)
Balance at 31 December
1,082
1,082
488
488
14. Claims development
The following tables illustrate the development of the estimates of earned ultimate cumulative claims incurred,
including claims notified and IBNR, for each successive underwriting year, illustrating how amounts estimated
have changed from the first estimates made.
As these tables are on an underwriting year basis, there is an apparent large increase from amounts reported
for the end of the underwriting year to one year later as a large proportion of premiums are earned in the year
of account’s second year of develop
ment.
Balances have been translated at exchange rates prevailing at 31 December 2024 in all cases.
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Gross:
Pure underwriting year
2024
2023
Total
£000
£000
£000
Estimate of gross claims
at end of underwriting year
338
141
479
one year later
-
739
739
Less gross claims paid
-
(153)
(153)
Gross claims reserve
338
586
924
Net:
Pure underwriting year
2024
2023
Total
£000
£000
£000
Estimate of net claims
at end of underwriting year
259
96
355
one year later
-
565
565
Less net claims paid
-
(153)
(153)
Net claims reserve
259
412
671
15. Technical provisions
The table below shows changes in the insurance contract liabilities and assets from the beginning of the
period to the end of the period.
2024
2023
Gross
provisions
Reinsurance
assets
Net
Gross
provisions
Reinsurance
assets
Net
£000
£000
£000
£000
£000
£000
Claims outstanding
Balance at 1 January
139
(45)
94
-
-
-
Claims paid during the year
(149)
-
(149)
-
-
-
Expected cost of current year claims
1,012
(247)
765
143
(46)
97
Change in estimates of prior year
provisions
(99)
45
(54)
-
-
-
Effect of movements in exchange rate
21
(6)
15
(4)
1
(3)
Balance at 31 December
924
(253)
671
139
(45)
94
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2024
2023
Gross
provisions
Reinsurance
assets
Net
Gross
provisions
Reinsurance
assets
Net
£000
£000
£000
£000
£000
£000
Unearned premiums
Balance at 1 January
1,950
(1,433)
517
-
-
-
Premiums written during the year
10,825
(2,804)
8,021
2,718
(1,935)
783
Premiums earned during the year
(8,533)
3,481
(5,052)
(721)
467
(254)
Effect of movements in exchange rate
87
(7)
80
(47)
35
(12)
Balance at 31 December
4,329
(763)
3,566
1,950
(1,433)
517
16. Creditors arising out of reinsurance operations
2024
2023
£000
£000
Due within one year
1,299
707
Total
1,299
707
17. Other creditors
2024
2023
£000
£000
Other liabilities
1,224
1,664
Total
1,224
1,664
Other creditors consist of a loan due to WDS of £1.2m. This floating rate loan accrues at a rate comparable to
major UK bank lending of 2.5% above the US federal rate. This loan is expected to be repaid by May 2025.
18. Cash and cash equivalents
2024
2023
£000
£000
Cash at bank and in hand
2,195
812
Total cash and cash equivalents
2,195
812
Included within cash and cash equivalents are the following amounts which are not available for use by the
Syndicate as they collateralise the US Situs requirements
.
2024
2023
£000
£000
Cash at bank and in hand
15
-
Total cash and cash equivalents not available for use by the syndicate
15
-
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19. Analysis of net debt
At 1
January 2024
£000
Cash flows
£000
Fair value
and exchange
movements
£000
At 31
December
2024
£000
Acquired
£000
Cash at bank and in hand
812
1,370
-
13
2,195
Other liabilities
(1,612)
1,549
(1,102)
7
(1,157)
Total
(800)
2,919
(1,102)
20
1,037
20. Related Parties
In the previous year the syndicate entered into an unsecured loan facility with WDS, which is related to Wildfire
Defense Corporate Member Limited by virtue of common control. Wildfire Defense Corporate Member Limited
participates on the syndicate as one of the corporate members. At the balance sheet date the outstanding loan
from WDS is £1.2m (2023: £1.7m) and interest of £0.2m (2023: £31k) has been accrued.
21. Off-balance sheet items
The Syndicate has not been party to an arrangement, which is not reflected in its balance sheet, where material
risks and benefits arise for the Syndicate.
22. Post balance sheet events
The loss estimate from the 2025 LA wildfires are immaterial to the Syndicate.
23. Foreign exchange rates
The following currency exchange rates have been used for principal foreign currency transactions:
2024
2023
Start of
the year
rate
Yearend
rate
Average
rate
Start of
the year
rate
Yearend
rate
Average
rate
Sterling
US dollar
24.
Funds at Lloyd’s
Every member is
required to hold capital at Lloyd’s which is held in trust and known as Funds at Lloyd’s (“
FAL
”
).
These funds are intended primarily to cover circumstances where Syndicate assets prove insufficient to meet
participating members’ underwriting liabilities. The level of FAL that Lloyd’s requires a member to maintain is
determined by Lloyd’s based on Pr
udential Regulation Authority requirements and resource criteria. The
determination of FAL has regard to a number of factors including the nature and amount of risk to be
underwritten by the member and the assessment of the reserving risk in respect of business that has been
underwritten. Since FAL is not under the management of the Managing Agent, no amount has been shown in
these Financial Statements by way of such capital resources. However, the Managing Agent is able to make a
call on the Member’s FAL to meet liquidity requirements or to settle losses.
25. Controlling Party of the Managing Agent
The Managing Agent’s immediate parent
undertaking is Marco Capital Holdings (UK) Limited, a company
incorporated in England and Wales. Registered address 24 Monument Street, 4th Floor, London, United
Kingdom, EC3R 8AJ.
The Managing Agent’s ultimate parent undertaking is Marco Capital Holdings Limited, a company incorporated
in Malta. Registered address is 171 Old Bakery Street, Valletta, VLT1455, Malta.
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26. Disclosure of Interest
PMA provided services and support to the Syndicate in its capacity as Managing Agent.
In the year, Managing
Agency Fees of £0.6m (2023: £0.3m) were charged to the Syndicate, in addition to service charges of £0.2m
(2023: £0.08m). At the yearend £0.1m (2023: £0.1m) was owed to PMA by the Syndicate.
Managing Agent’s interest:
During 2024 PMA was the Managing Agent for five syndicates. Syndicates 1347,
1975, 1996 and 1254 and 9 August 2024, PMA took on the management of syndicate 1110.
The Financial Statements of the Managing Agency can be obtained by application to the Registered Office (see
page 3).
Docusign Envelope ID: CC8F064C-9893-4F57-BFCB-16640029D67F