In a world where competition for capital continues to accelerate, the Lloyd’s insurance and reinsurance market aims to create more flexibility for capital entering and investing there, recognising that its unique structure can help allocators access more risk per unit of capital than elsewhere.
Lloyd’s announced its 2025 results today, which you can read more about over at our sister publication Reinsurance News.
Also revealed today was a new strategic plan, with maximising its capital advantage and making it increasingly flexible for capital to access returns from Lloyd’s part of it.
The strategic plan states that Lloyd’s wants to innovate at scale, with the London Bridge 2 PCC insurance-linked securities (ILS) structure a cornerstone that exemplifies that.
A reason Lloyd’s is a natural innovation partner is that it has, “A capital model that shoulders more risk per dollar than any other financial institution,” the strategy states.
Going on to say that is has capital mobility, “with capital able to flow into London efficiently through London Bridge 2.”
While Lloyd’s also has, “Structuring flexibility to build solutions across members, third-party capital, ILS, captives and efficient reinsurance to home balance sheets.”
The London Bridge ILS structure has been key to bringing more third-party capital into the market in an investor friendly and efficient manner.
Lloyd’s reported today that, “At 31 December 2025, Funds at Lloyd’s (FAL) has increased by £632m, bringing the total to £31,132m.
“Of this increase, £400m was provided by institutional investors with support from the London Bridge 2 platform, taking the total amount invested through London Bridge to $2.9bn.”
The strategy sums up the capital advantage by saying, “Lloyd’s today is the most capital-efficient place in the world to connect capital to insurance risk. We provide unrivalled flexibility to underwriters looking to source capital to back insurance risk. Our underwriters can trade on their own balance sheets, leveraging the resources of third-party institutional capital and/or by connecting to Names capital.
“We will protect, advance and deploy our unique capital advantage to allow increased return for the same level of risk within the marketplace compared to outside Lloyd’s.”
Continuous innovation on top of the success of London Bridge 2 to create enhanced flexibility for capital looking to access insurance and reinsurance-linked returns from Lloyd’s could be a meaningful opportunity for the market.
Sir Charles Roxburgh, Chair of Lloyd’s, commented in the Lloyd’s annual results, “The results reported for 2025 reflect the underlying strength and resilience of the Lloyd’s market. They demonstrate the benefits of disciplined underwriting, improved performance and reforms undertaken in recent years. They also underline Lloyd’s continued relevance to clients and capital providers.”
Roxburgh highlighted that part of the vision for Lloyd’s is for it to “compete effectively for global capital.”
Further stating, “The external environment remains demanding. Risks are becoming more complex and interconnected. Competition for capital is intensifying. The expectations around institutions such as Lloyd’s continue to rise, not only in financial terms but with regard to governance, transparency and contributing to global resilience.
“I remain confident in the enduring strengths of Lloyd’s: its global reach, concentration of expertise and ability to convene capital around the world’s most complex risks. With disciplined governance, focused execution and sustained international engagement, Lloyd’s is well placed to fulfil its vision to be the pre-eminent global marketplace for insurance risk.”
Lloyd’s CEO Patrick Tiernan highlighted what he sees as the unique strength of Lloyd’s, “Lloyd’s can shoulder more insurance risk for each unit of capital than any other organisation in the world.”
Saying, “My focus is on setting a clear strategic direction that sharpens our financial edge and maximises our unique capital advantage.”
Tiernan commented on the new Lloyd’s strategy, explaining capital’s key role, “First, leading underwriting performance. Sustainable profitability through-the-cycle remains the primary measure of success. We will promote expertise and underwriting discipline, while remaining bold in embracing nascent risks.
“Second, building a more efficient marketplace. We will reduce friction, lower costs and create predictable, risk-based oversight so that capital and talent can move at pace.
“Third, maximising our capital advantage. Our unique structure allows more risk to be taken per unit of capital than elsewhere. We will protect and deploy that advantage to increase returns for the same level of risk.
“Fourth, creating a Lloyd’s to be proud of. Focus, innovation and talent are not soft ambitions. They are competitive necessities. We will invest where we can increase return or relevance, and we will stop doing what does not.”
Lloyd’s aims to remove barriers on capital and innovation, bringing greater efficiency to areas such as Names capital and ensuring the capital advantage can be met for investors and third-party capital providers.
Part of that is also having “increased flexibility around entry, exit and deployment of capital,” which alongside capital efficiency and with structures such as London Bridge 2, should serve to continue increasing Lloyd’s attraction to institutional allocators.
As we reported before, the London Bridge 2 PCC risk transformation vehicle opened 14 cells in Q4 2025, with around $660 million of new capital brought into the Lloyd’s market.
Recent examples that have seen the London Bridge 2 PCC structure used include:
– Al Wathba Insurance uses London Bridge to allocate capital to Lloyd’s opportunities.
– Beazley prices $100m Fuchsia nat cat bond ~21% below initial mid-point of guidance.
– Allianz and Oaktree launch sidecar syndicate at Lloyd’s, funded via London Bridge 2 PCC.
– OAK launches retro syndicate 1440 with investor backing, including via London Bridge.
– Blackstone to fund new Fidelis Partnership syndicate 2126 at Lloyd’s via London Bridge 2.
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