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Member’s agent

Advises Lloyd’s members on their underwriting commitments and links them to their syndicates. The member’s agent’s agreement sets out the duties, powers and remuneration of the agent and the obligations of the member. Advising on syndicate participation is regarded as financial advice and is therefore regulated by the FSA. Members’ agents must also adhere to the Lloyd’s Code of Conduct for Members’ Agents.

Member’s margin

Required minimum margin of solvency for a Lloyd’s member calculated in accordance with FSA rules for general business and longterm business. See ANNUAL SOLVENCY TEST; MEMBERS’ ANNUAL SOLVENCY TEST; REQUIRED MINIMUM MARGIN.

Members of Lloyd’s

Members provide the capital to support the 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. Corporate members provide most of the capital for the Lloyd’s market.

Members’ agent

An underwriting agent which has permission from Lloyd’s to be appointed by a member to provide services and perform duties of the same kind and nature as those set out in the standard members’ agent’s agreement. These services and duties include advising the member on which syndicates he should participate, the level of participation on such syndicates and liaising with the member’s managing agents.

Members’ agent’s agreement

A standard form of contract between a member and his member’s agent, which sets out the services, duties, powers and remuneration of the member’s agent and obligations of the member. The terms of the contract with the exception of the amount of the members’ agent’s remuneration are set by the Council of Lloyd’s. A copy of the current versions of the members’ agent’s agreement is annexed to the Agency Agreements Byelaw.

Members’ Agents Pooling Arrangement (MAPA)

Allows Lloyd’s members to participate in more syndicates than normally possible. The members’ agents pool underwriting capacity and the members spread their risk by taking smaller lines across more syndicates. A minimum of five members’ agents must participate in each MAPA with no more than 10 per cent of MAPA capacity being allocated to any one syndicate. Corporate members wishing to participate must appoint a member’s agent in order to do so.

Members’ annual solvency test procedure

Each Lloyd’s member must have sufficient assets to meet liabilities plus a prescribed margin (see required minimum margin (general business) and required minimum margin (longterm business). If there is a shortfall the member must provide additional assets. The members’ Funds at Lloyd’s usually covers the deficiency. Ultimately Lloyd’s must show the FSA that it has sufficient assets to cover any aggregate shortfall of all members after the prescribed surplus tests.