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The LIM is a distinct and separate part of the UK insurance and reinsurance industry centred in the City of London, predominantly within the EC3 postal district. Its main participants are insurance and reinsurance companies, Lloyd’s of London syndicates, Coverholders/Agents, Marine Protection and Indemnity Clubs (P&I Clubs), run-off agencies, Delegated Claims Administrators (aka TPAs) and brokers who handle most of the business.
The London Market has a heritage tracing back to the 17th century and today it is the largest global hub for commercial and specialty risk delivering solutions for risks in almost every territory around the world.
It is a true market of over 350 insurance operations and affiliated professional services firms working within the square mile of the City of London, and employs nearly 50,000 people.
Xchanging Ins-sure Services (XIS) oversaw the creation of a single “bureau” for both the Lloyd’s and companies markets for premium and policy processing services. The central processing and net settlement of daily transactions between all the market players is key to the success of the LIM.
The UK Regulators for the insurance industry are the Prudential Regulatory Authority (PRA) and the Financial Conduct Authority (FCA). The PRA is part of the Bank of England and promotes the safety and soundness of insurers, and the protection of policyholders. The FCA regulates how these firms behave, as well as more broadly the integrity of the UK’s financial markets.
Generally, insurers, including Lloyd’s Managing Agents, are authorised and regulated by both the PRA and the FCA (Dual Regulation) and insurance intermediaries, brokers, coverholders and DCAs are singularly authorised and regulated by the FCA. In addition, Lloyd’s of London may be seen as a ‘third regulator’ for its Managing Agents in that syndicate groups must adhere to Lloyd’s Minimum Standards and the Corporation of Lloyd’s Byelaws.