Lloyd's sets rules for broker-originated reinsurance structures, capping them at 10% of a broker's treaty portfolio

Lloyd's has issued a market bulletin setting out what it expects from broker-originated reinsurance structures, Artemis reported on 16 October 2026. The framework takes effect on 1 January 2027. It covers facilities that may in effect have a single capital provider, such as an asset manager or capital markets investor that wants index-like exposure to Lloyd's underwriting.

According to Artemis, structures must show alignment with Lloyd's cross-cycle target of a 95% net combined operating ratio. At first they may place no more than 10% of an individual broker's treaty portfolio, measured across the market, and brokers may not own or capitalise them. The member aligned with the managing agent must provide at least 19.99% of the capital, and lead reinsurers at least 25% of the capacity. Cedents must place either all of their eligible portfolio with that broker into the structure or none of it, and should share in the efficiency gains through a client dividend.

Managing agents need enough reinsurance analysis and pricing skill to challenge the broker's assumptions, and annual business plans need Lloyd's approval, as for other underwriting structures. Hybrid fronting carriers, MGUs and legacy providers are out of scope, and no exposure to type 4 cyber war wording is allowed. If a structure has not reached at least 70% indexation by its third year, Lloyd's and the managing agent will agree next steps, which can include winding it up.

Rachel Turk, who issued the bulletin for Lloyd's, called the framework "transparent, principles-based", Artemis reported. The guidance follows reports of a vehicle backed by Aon and Blackstone, widely said to be codenamed Cortina, which raised questions about what Lloyd's would accept as third-party capital shows more interest in the market.