Montpelier Re Launches New Lloyd’s Syndicate; S&P Comments

Bermuda’s Montpelier Re Holdings Ltd. announced that it has received approval from Lloyd’s for the commencement of trading on July 1, 2007 of a new Syndicate, to be known as Montpelier Syndicate 5151, pseudonym “MRE”.

“The Syndicate will underwrite a book of non-marine property and engineering classes and a limited amount of specialty casualty business sourced from the London, U.S. and European markets,” said the announcement. “Stamp capacity for 2007 is set at £47 million [$93.6 million], but is planned to increase to £143 million [$285 million] in 2008, subject to market conditions. Funds at Lloyd’s will be provided by a sole corporate member wholly-owned by Montpelier.”

Montpelier appointed Richard Chattock, who has been with the Company as a Senior Underwriter since its beginning, as the active Syndicate underwriter. He was formerly Underwriting Manager, Property and Casualty Division at Cox Syndicates Limited.
Montpelier’s existing underwriting staff will join Chattock in London.

The bulletin noted that one of Syndicate 5151’s first objectives would be to “accept business from a new U.S. MGA, Montpelier Underwriting Inc. (MUI), which is wholly-owned by Montpelier.” Stanley Kott, formerly CEO of Hartford Conn.-based Wellington Underwriting Inc., heads MUI. It will bring “variety of reinsurance and insurance business, predominantly short-tail in nature, to the Syndicate,” said the bulletin.

Montpelier Chairman and CEO, Anthony Taylor, noted that the move comes at an “appropriate time to expand our platform beyond the shores of Bermuda.” The move marks Montpelier Re’s expansion into a “broader range of distribution channels and to increase, over time, the proportion of non catastrophe-exposed business that we underwrite,” Taylor continued. He added that the Company would “continue to maintain our traditional focus on short-tail business.”

Standard & Poor’s Ratings Services issued a comment on Montpelier Re’s new syndicate, indicating that its ratings (currently “BBB”/Negative/) and those of its “related entities are not affected by the company’s announcement that it has approval from Lloyd’s to commence trading of its new syndicate.”

Topics Excess Surplus Underwriting Lloyd's