lloyd’s quick guideAn introduction to who we are and what we do

April 2010

What’sinside?

Lloyd’s Quick Guide

Lloyd’s is the world’s leading specialist insurance market, conducting business in over 200 countries and territories worldwide – and is often the first to insure new, unusual or complex risks. We bring together an outstanding concentration of specialist expertise and talent, backed by excellent financial ratings which cover the whole market.

HISTORY From coffee beans to complex risks 02

How Lloyd’s works Market structure 04

MANAGING AGENTS A dynamic and diverse marketplace 06

IN ACTION How we’re moving ahead 08

2009 financial highlights Our strength and ratings 10

REACH Where we’re active around the world 12

today Exploring our current business activities 14

360 Risk insight How we’re preparing for the future 18

global contacts 20

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You are reading Lloyd’s Quick Guide. This publication is accompanied by Lloyd’s Highlights. These publications and more detailed information on our operations, activities and strategy can be found at www.lloyds.com/publications

Since then, Lloyd’s has grownfrom its marine heritageto become the world’s leadingmarket for specialist propertyand casualty insurance.

To this day, Lloyd’s remains a place where business is conducted face-to-face. Like any dynamic, innovative market it allows those with something to sell (underwriters providing insurance coverage) to make contact with those who want to buy (brokers, working on behalf of clients who are seeking insurance). Our strength is built upon the diversity of managing agents (underwriting agents responsible for managing a syndicate) who choose to operate at Lloyd’s, supported, by capital from diverse sources around the world.

historyfrom coffee beansto complex risks

Lloyd’s began over 300 years agoin Edward Lloyd’s coffee house – aplace where shipowners could meetpeople with capital to insure them.

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Follow the Lloyd’s journey atwww.lloyds.com/history

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HOW LLOYD’S WORKSMARKET STRUCTURE

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The Lloyd’s market houses an outstanding concentration of underwriting expertise and flexible pools of capital. It’s a dynamic environment with many different stakeholders.

WHO’S WHO?Policyholdersrequest insurance coverBusinesses, organisations, other insurers and individuals from around the world want to protect themselves against risks that could affect them. They approach a broker and explain their individual needs.

Brokersplace the risksMost of Lloyd’s business is placed with the assistance of a broker. In addition to being regulated by their national regulator, brokers must also meet Lloyd’s own eligibility criteria.

Coverholdersplace the risksCoverholders are companies authorised by a managing agent to enter into contracts of insurance and/or issue insurance documentation, on behalf of the members of a syndicate.

Service companiesplace the risksA service company is an approved coverholder which Lloyd’s has classified as a ‘service company’ by reason of it being a wholly owned subsidiary of either a managing agent or its holding company.

Syndicateswrite the insurance risksUnderwriters decide on behalf of its members which risks a

syndicate will underwrite and on what terms. Much of Lloyd’s business is conducted in the Underwriting Room, where face-to-face negotiations take place with brokers regarding the risks they want to place at Lloyd’s.

Managing agentsmanage the syndicatesThese are companies set up to manage one or more syndicates. The managing agent employs the underwriting staff and handles the day-to-day running of a syndicate’s infrastructure and operations.

Membersprovide the capitalMembers of Lloyd’s provide the capital to support syndicates’ underwriting. Members include

some of the world’s major insurance groups and companies listed on the London Stock Exchange, as well as individuals and limited partnerships.

Corporation of Lloyd’ssupports the marketThe Corporation oversees and supports the market and promotes Lloyd’s around the world. This includes determining the capital that members must provide to support their proposed underwriting, working with the management of underperforming syndicates to improve performance, undertaking financial and regulatory reporting for the Lloyd’s market, managing and developing Lloyd’s global network of licenses and the Lloyd’s brand.

THE MARKET

corporation of lloyd’s

Managing agents Syndicates

Business Flow

Policyholders Distribution channel

BrokersCoverholdersService companies

Members

CorporateNon-corporate

(via Members’ agents)

Capital flow

0706Find out about our managing agents atwww.lloyds.com/directories

As at 31 December 2009, the Lloyd’s market was home to 52 managing agents, shown below, and 84 syndicates. However, the breadth and depth of specialist broking and underwriting expertise, brought together under one roof at Lloyd’s, is much more important than the sheer scale of the market.

managing agentsa dynamic and diverse marketplace

S.A Meacock & Company LimitedRITC Syndicate Management Limited

Our processes may change, but mutuality of capital will remain central to Lloyd’s, and is a key factor in maintaining our competitive position in the global insurance market while also underpinning our international licences and strong financial ratings.

We continue our steady expansion into international markets to build our platform for the future. A major priority has been and continues to be managing performance throughout the cycle. Although our resolve has been tested over the past 12 months, our disciplined approach to underwriting and our conservative investment mix have ensured that we maintain our strong competitive position.

IN ACTIONHOW WE’RE MOVING AHEAD

We continue to introduce ways to make Lloyd’s an easier place to do business, increasing efficiency and standards of service.

0908

10 11View our financial reporting information atwww.lloyds.com/financialreports

Three of the world’s leading insurance rating agencies recognise Lloyd’s strengths and robust capitalisation and the financial strength of the market. In 2009, all three rating agencies reaffirmed our ratings.

All Lloyd’s syndicates benefit from Lloyd’s central resources, including the Lloyd’s brand, its network of global licences and the Central Fund. As all Lloyd’s policies are ultimately backed by this common security, a single market rating can be applied. The Lloyd’s financial strength ratings apply to everypolicy issued by every syndicate at Lloyd’s since 1993.

“ Lloyd’s competitive position is strong, supported by the positive attributes associated with its unique brand, attraction as the world’s largest subscription market, London’s continued position as a major international insurance and reinsurance market, and policyholder loyalty. In our view, the impressive level of resilience that Lloyd’s has demonstrated to the events of the past 12 months further reinforces its attractiveness as an operating platform.”

Standard and Poor’s October 2009

Financial security is crucial. It gives confidence to capital providers and peace of mind to policyholders. Lloyd’s strength and robust capitalisation is reflected in our ratings.

2009 financial highlightsour strength and RATINGS

Standard & Poor’s A+ (Strong)3Fitch Ratings A+ (Strong)4

A.M. Best A (Excellent)5

Lloyd’s ratings 2 Where does our capital come from? 1

31% UK listed and other corporate members

55% International insurance industry

14% Individual members

1-2 Lloyd’s Annual Report 2009. 3 Standard & Poor’s affirmed its Lloyd’s

financial strength rating and assigned a Stable Outlook, August 2009.

4 Fitch Ratings affirmed its Lloyd’s financial strength rating and assigned a Stable Outlook, July 2009.

5 A.M. Best affirmed its Lloyd’s financial strength rating with a Stable Outlook, July 2009.

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reachwhere we’re activearound the world

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Risks aren’t confined by oceans, borders and boundaries, so neither is the Lloyd’s market. Our global reach is balanced by local knowledge. Lloyd’s accepts business from over 200 countries and territories worldwide. Our 80 licences, supported by a network of local offices, ensure access to insurance markets large and small.

136 Lloyd’s Annual Report 2009.

Lloyd’s class breakdown by region 6

US & Canada

United Kingdom Europe

Central Asia & Asia Pacific

Other Americas

Rest of the world

TOTAL

Reinsurance 31% 28% 36% 47% 75% 61% 36%

Property 31% 20% 16% 14% 8% 9% 23%

Casualty 20% 21% 20% 25% 8% 13% 20%

Marine 5% 7% 17% 6% 4% 8% 7%

Energy 10% 1% 6% 4% 2% 3% 6%

Motor 1% 22% 1% 1% 1% 2% 5%

Aviation 2% 1% 4% 3% 2% 4% 3%

TOTAL 45% 20% 16% 9% 6% 4% 100%

of the ftse 100and...

of dow jonesindustrial average companies all underpinned by...

years of underwriting experience

lloyd’s in numbers

Syndicatesof specialist underwriting experience and talent

brokerscreating insurance solutions in over...

countries and territorieswhich covers...

84 181 200

32296% 87%

14 15Read the latest news on Lloyd’s atwww.lloyds.com/newscentre

EnergyThis market is steadily evolving, from onshore and offshore property, oil rigs and refineries to emerging renewable energy ventures. Energy makes up 6% of Lloyd’s business.

MarineThis is where the Lloyd’s story began over 300 years ago. Today it is a smaller but still a significant part of our business. Most of the cover in this area is for hull, cargo, marine, liability and specie (the insurance of highly valued items such as fine art while in transit). Marine makes up 7% of Lloyd’s business.

PropertyThe property sector is hugely varied, encompassing everything from supporting the building of the new World Trade Center toprotecting holiday resorts against storm damage. It’s also highly competitive with capacity increasing as many insurers look to diversify away from the catastrophe business. Property makes up 23% of Lloyd’s business.

CasualtyCasualty risks are particularly specialist and complex and the US accounts for a large proportion of this business. This market includes professional indemnity, medical malpractice, accident and health, directors & officers liability and general and employers’ liability. Casualty makes up 20% of Lloyd’s business.

ReinsuranceThe reasons for reinsurance tend to fall into four categories: to protect an insurer against very large claims; to reduce exposureto ‘peaks and troughs’; to obtain an international spread of risk; and to increase the capacity of the direct insurer. Reinsurancemakes up 36% of Lloyd’s business.

AviationLloyd’s is an industry leader within the global aviation market. This includes airline, general aviation, products, war and terrorist coverage, airports and satellite business. Since 9/11, this sector’s loss experience has been well below the industry’s long-termaverage, thanks to new safety systems, increased security and improved regulation. Aviation makes up 3% of Lloyd’s business.

MotorIn this competitive sector, Lloyd’s is focused on company fleet business and non-standard risks. This includes high value, vintageand collectors’ vehicles, high risk drivers and affinity groups. Lloyd’s has insured numerous land speed record attempts and Sir Malcolm Campbell, the first man to break 300mph on land, was a Lloyd’s broker. Motor makes up 5% of Lloyd’s business.

todayexploring our current business activities

The Lloyd’s market insures complex and specialist risks – from oil rigs to celebrity body parts. With our syndicates under one roof in the Underwriting Room, brokers are able to find individual and innovative cover, whatever their challenge may be.

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Intro copy

Spreading our wingsThe launch of the Airbus 380 heralds a new era of air travel. At 73 metres long, 24 metres high and with a wingspan of 79.8 metres it dwarfs most other commercial jets. Singapore Airlines made the first commercial flight in October 2007. As an insurer of the airline, Lloyd’s underwriters recognise that the arrival of this new class of superjumbo brings higher limits of liability and greater challenges to develop their insurance products.

Racing aheadThe inaugural Singapore Grand Prix was arguably one of the highlights of the 2008 Formula 1 calendar. It was not only a new street circuit but also the first ever F1 night race. Street circuits are notoriously complex insurance risks requiring specialist knowledge. Brokers and underwriters in both London and Singapore worked together to provide coverage for the event.

Sculpting a skylineConstruction of the new World Trade Center development, probably the world’s most anticipated building project, is now underway. The new site will feature three towers designed by renowned Pritzker-prize winning architects Norman Foster, Richard Rogers and Fumihiko Maki. Lloyd’s is supporting the development with worker’s compensation, general liability, excess liability and speciality insurance programs.

A matter of tasteIn March 2009, Lloyd’s insured the tongue of Gennaro Pelliccia, Costa Coffee’s Italian Master of Coffee. Mr Pelliccia personally tastes every single batch of raw coffee beans at the company’s roastery in London, before they are roasted and shipped to its stores. This is not the first time Lloyd’s underwriters have insured a tongue, wine tasters have also taken out policies and in 2008 a Dutch wine maker, Ilja Gort, insured his nose.

Lloyd’s is an insurance pioneer into new, complex and unusual areas. These are just some of the many landmark and intriguing risks placed in our market.

todayexploring our cuRrent business activitiescontinued

Find out more about the risks Lloyd’s cover atwww.lloyds.com/newscentre

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To view 360 Risk Insight reports and analysis on these topics as well as other emerging risk issues throughout the year, please visit www.lloyds.com/360

Global risks change rapidly. Companies need to anticipate tomorrow’s risks today. At Lloyd’s, we’ve been helping businesses do just that for over 300 years. From climate change to terrorism, energy security to liability, boards must anticipate and understand emerging risks to successfully lead their businesses into the future.

Lloyd’s 360 Risk Insight programme brings together the views of the world’s leading business, academic and insurance experts. We analyse the latest material on emerging risk to provide businesses with critical information at their fingertips. Through research, reports, events, news and online content, Lloyd’s 360 Risk Insight drives the global risk agenda as it takes shape. We provide the practical advice that businesses need to turn risk into opportunity.

This year we launch the Lloyd’s RiskMap – a groundbreaking online tool which displays emerging risk hotspots around the world. Aimed at risk professionals, the interactive map provides users with real time news and analysis of global events allowing them to track changes in risk priorities.

Energy securityThis year Lloyd’s 360 Risk Insight is exploring some of the major global challenges and risks facing business in the twenty-first century. As the world’s population continues to grow and economic development continues apace in emerging markets, the world’s natural resources are coming under increasing pressure. Securing future energy supplies, while limiting further damage to our environment is becoming a major issue for both governments and business and we will examine the risks business is facing around energy security.

Water scarcityWhile oil has long been recognised as a precious commodity, arguably water is an even more valuable resource and that is why we will be looking into the implications of growing water scarcity on business and how companies can prepare for and manage water risks.

GlobalisationUndoubtedly we are living in an increasingly globalised world, but as well as the many benefits and opportunities that brings to business, it can also result in exposure to new risks as the global financial crisis illustrated. Lloyd’s 360 Risk Insight will analyse what the risks of globalisation are for business.

In the grey area of emerging risk, get the facts in black and white from the world’s sharpest minds.

Future topics and issuesunder analysis.

360 risk insighthow we’re preparing for the future

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globalcontacts

Argentina John Wilson +54 11 4798 8975Australia Keith Stern +61 2 9223 1433Austria Dr Harald Svoboda +43 (0)1 713 0713Belgium Alexis Fontein +32 3470 2309Belize Derek Courtenay +501 223 5701Brazil Marco Castro +55 21 2220 8446Canada Deborah Moor +1 416 360 1512Chile Emilio Sahurie +56 2 676 9358China (LRCCL) Eric Gao +86 21 6162 8201Denmark Jes Anker Mikkelsen +45 (0)7227 3586France Guy-Antoine de

La Rochefoucauld +33 1 4260 4343Germany Burkard von Siegfried +49 (0)69 5970 253Greece/Cyprus Marianna Papadakis +44 (0)20 7327 6802Hong Kong Alex Faris +852 2918 9911Iberia (Spain/Portugal) Juan Arsuaga +34 914 262 312Ireland Eamonn Egan +353 1 6 313 600Israel Jonathan Gross +972 (0)3 612 2233Italy Enrico Bertagna +39 02 637 8881Japan Iain Ferguson +81 3 5656 6926Malta Mark Gollcher +356 2569 1500Namibia Peter Grüttemeyer +264 61 207 5111Netherlands Alexis Fontein +31 10 506 6600New Zealand Scott Galloway +64 4 472 7582Norway Espen Komnaes +47 2311 4560Poland Witold Janusz +48 22 370 1618Singapore Jon Song +65 6536 7860South Africa Amit Khilosia +27 11 884 0486Sweden Eva Lindberg +46 1018 463 1111Switzerland Graham West +41 44 266 6070United Kingdom Lloyd’s International Trading Helpdesk +44 (0)20 7327 6677US Illinois/US Kentucky Pat Talley +1 502 875 5940US New York Hank Watkins +1 212 382 4090US Virgin Islands Henry Feuerzeig +1 340 715 4443US West Coast Anthony Joseph +1 210 706 4100Zimbabwe Emilia Chisango +263 4 302 600

Visit www.lloyds.com/worldwide for more information about our international offices.

Visit www.lloyds.com/publications for other language versions of this publication.

For further information or reading on any of the topics included in this booklet, please refer to the Lloyd’s Annual Report 2009 at www.lloyds.com/financialreports

Lloyd’s is a registered trademark of the Society of Lloyd’s. © Lloyd’s 2010.

For additional copies of this publication, please contact marketing@lloyds.com

Lloyd’s One Lime Street London EC3M 7HATelephone +44 (0)20 7327 1000 Fax +44 (0)20 7626 2389www.lloyds.com