Lloyd’s global specialty reinsurer/MS Amlin has formed a consortium to expand property treaty capacity across all property per-risk lines.
The Property Per Risk (PPR) Alliance expanded reinsurance/insurer maximum lines from $50 million to $67.5 million, increasing placement capacity by 35% while maintaining a single coordinated underwriting and claims process.
Hiscox said this “industry-first property treaty alliance” is expected to play an important role in providing additional capacity to data centers around the world, as demand for higher limits continues to grow.
Data center infrastructure is expected to increase to nearly $7 trillion by 2030, driving demand for increased reinsurance capacity, according to McKinsey.
The new consortium brings together the four Lloyd’s syndicates behind MS Amlin, including Nephila Syndicate 2358, Nephila Syndicate 2359, Hampden Syndicate 2689 and Apollo Syndicate 1969. MS Amlin will act as lead underwriter, retaining underwriting and claims authority.
Stephen Price, head of North America Property Reinsurance at MS Amlin, commented: “This syndicate increases our coverage size by more than a third, enabling brokers to access additional A-rated Lloyd’s capital in a single placement, while enabling us to maintain full oversight of underwriting and claims.
“By consolidating Lloyd’s capabilities into a single smart following product, the alliance will simplify placements for brokers, reduce panel complexity and ensure consistency of terms and claims processing across placements.
Price continued, “In addition, the mechanism brings new diversified capital into syndicates that have not traditionally been active in the sector, thereby increasing Lloyd’s overall market capacity and increasing the relevance of Lloyd’s pricing and wording positions in global markets.
“The challenge for the market is to balance the scale of capacity required with careful management of accumulated risk. As this emerging business class evolves, a detailed understanding of risk exposures and careful selection of risks is critical.”