Despite lower legacy deal activity in 2024 and 2025 amid relatively muted catastrophe activity and strength in the broader reinsurance market, brokerage group Aon expects activity in the specialist Lloyd’s market to accelerate as capital allocation becomes more disciplined.
Insurance and reinsurance broker Aon’s April 2026 Lloyd’s Heritage report notes that current market dynamics, including a slowdown in the reinsurance cycle, increased M&A activity and an increased focus on addressing historical risks, support a positive outlook for the Lloyd’s Heritage business in the world’s oldest insurance and reinsurance market.
Traditional specialists RiverStone International, Enstar, Premia, Compre and Marco Capital have collectively taken on nearly $15 billion in reserves through specialized reinsurance closing (RITC) syndicates since 2010, according to Aon. This underlines the growing size and capabilities of Lloyd’s RITC market, as the aforementioned consortium brings additional capabilities, enhanced claims expertise and increasingly data-driven reserve and portfolio management capabilities.
“For cedants, this deepening market capability translates into reduced volatility, improved operational efficiencies, and the ability to unlock value in well-reserved portfolios through competitive trading dynamics and professional runoff execution,” Aon said.
The report shows that between 2015 and 2025, Lloyd’s traditional deal size increased as the market expanded, a trend that Aon is also witnessing in the wider traditional market. In fact, at Lloyd’s, the average deal size over the past decade has been just under $300 million, with 50% of deals falling between the historical “sweet spot” of $100 million and $300 million.
Still, there is a place for smaller deals, which remain an important part of the wider legacy space, with 25% of Lloyd’s deals being done for portfolios with reserves below $100 million, according to Aon.
In terms of large deals, 20% over the 10-year period were worth $400m or more, with the largest single deal being MS Amlin and RiverStone’s £1.2bn deal, which completed in 2023.
As market conditions change, Aon expects more legacy deals to emerge at Lloyd’s in the coming months, explaining that in the current operating environment, “carriers typically take a more nuanced view of underperforming segments, while long-tail uncertainty remains a key consideration for categories such as U.S. casualty and aviation.”
Interestingly, the Aon report found that more than 75% of Lloyd’s syndicates have yet to complete legacy deals, suggesting there is huge untapped potential. Meanwhile, repeat sellers have accounted for approximately 66% of provisioning transactions since 2015, suggesting that many insurers are using retroactive solutions as recurring strategic leverage.
“Lloyd’s legacy market has evolved from specialist rectification solutions to mainstream tools for managing balance sheets, capital and earnings. As insurers operate in a more competitive environment and prepare for the potential softening of rates across multiple categories, Aon expects legacy trading to play an increasingly important role in helping managing agents and capital providers protect performance, recycle capital and maintain underwriting appetite. We offer clients a range of legacy solutions as part of a wider toolkit for strategic capital management,” said Rob Margetts, Legacy Business. Aon’s reinsurance broker.
Aon’s comprehensive Lloyd’s Legacy report also explores how runoff transactions can help carriers free up capital tied up in prior year reserve risk, protect current year performance, support underwriting capacity and many other benefits.
In addition, the report notes that the market’s continued focus on oversight and discipline is increasing confidence in the Lloyd’s legacy market, highlighting the introduction of a legacy oversight framework, including early engagement through the Legacy Review Group, and formal approval through the Capital and Planning Group.
Mike Cane, head of UK capital advisory at Aon, said: “As expertise, governance and execution capabilities continue to grow, insurers that actively leverage traditional assets will be able to optimize capital, reduce volatility and maintain strategic flexibility as the cycle evolves.”
The broker concluded that a more mature and competitive legacy landscape will be supported by a number of factors, including continued operator M&A activity, increasing new entrants, as well as alternative capital and continued product innovation (such as forward exit options).
For a list of recent and historic legacy transactions at Lloyds and beyond, see our Legacy and Runoff Reinsurance Transactions page.
