Lloyd’s capacity tips towards small and mid-sized syndicates: Howden Re

June 2 - (The Insurer) - Lloyd’s gross premiums were predominantly driven by volume growth rather than price increases in 2024, marking a shift from prior years as small and mid-sized syndicates increase underwriting capacity amid moderating prices, Howden Re said in a report published on Monday.

The reinsurance broker noted that as capacity is strategically deployed, momentum is shifting away from the largest markets to small and medium-sized syndicates and new entities.

While total market capacity has risen to 56 billion pounds in 2025, the top 10 syndicates’ share fell to 37%, compared to 39% in 2023.

Medium syndicates (with capacity between 100 million pounds and 800 million pounds) had their share of total capacity increase by 14% year on year, with small syndicates (less than 100 million pounds capacity) increasing by 22%.

Lloyd's startups reached a five-year high with 11 new launches in 2024, compared to just three in 2023.

By franchise, Howden Re found that Beazley reduced its overall capacity most significantly (-20%) as part of the carrier's strategic to reallocate capital across the business, notably including the expansion of its U.S. E&S operations.

Elsewhere, Canopius and Ark were noted for meaningfully increasing their capacity year on year by 28% and 29% respectively.

PRICING GROWTH SLOWS

Howden Re's analysis found that price changes contributed just 0.3% to Lloyd's premium growth in 2024, compared to 7.2% in the prior year.

The largest premium increases in 2024 were driven by reinsurance and property. U.S. dollar-denominated business accounted for most business, which produced a weaker average rate over the year.

Increasing volatility in property lines mean that pricing growth will be an important factor in maintaining profitability in future, Howden Re said.

GWP continued to increase over 2024, although Howden Re noted that this was at a slower rate than prior years. Sustained underwriting profit from reinsurance and property business accounted for 36% and 44% of total profit, respectively, with less attractive conditions in casualty reinsurance and aviation.

Lloyd's posted a combined ratio of 86.9%, a deterioration of 2.9 percentage points compared to 2023. Howden Re noted that this was affected by a 4 point increase in the cat loss ratio owing to several major catastrophes throughout the year, such as the Baltimore Bridge collision and Hurricanes Helene and Milton.

SYNDICATE BENCHMARKING

Howden Re's analysis found that most of the top 25 syndicates reported an underwriting improvement of 7 percentage points compared to the prior five-year average, from 95% to 88%.

Underwriting improvement for the majority of the market's top 10 syndicates saw a 4 point improvement in their 2024 combined ratio compared to the five-year average as portfolios shifted to reinsurance and property.

Property lines continued to deliver high returns, accounting for 44% of underwriting profit as a result of volume growth and fewer attritional losses. Reinsurance delivered a GWP compound annual growth rate of 26.5% among the top syndicates.

On the other hand, casualty and specialty line saw mixed results. While casualty posted a sub-100% combined ratio for the second consecutive year (suggesting improving fundamentals), Howden Re added that pricing pressures and inflation risk meant that growth was constrained.

“The growth focus is clearly shifting to disciplined exposure management,” said David Flandro, head of industry analysis at Howden Re. “Lloyd’s ability to adapt — through risk selection and investment in underwriting talent — will be critical in navigating the next phase.”