National Indemnity Commits $72 Million to Lloyd’s Euclidian

July 4, 2002

National Indemnity, a subsidiary of Berkshire Hathaway, has concluded an agreement with Lloyd’s Euclidian Syndicate 1243 to provide £ 50 million ($76 million) in financing on a whole account qualified quota share basis.

Euclidian’s announcement noted that the deal would increase the syndicate’s underwriting capacity for the present year to £213 million ($323.7 million). It follows an earlier commitment by National last January of £42 million ($63.84 million). Euclidian has been able to raise its capacity by 75 percent for 2002.

Chairman James Truscott commented that “This is a very significant business development and a huge vote of confidence for Euclidian and Syndicate 1243. In agreeing the maximum allowable 30 per cent quota share, Berkshire Hathaway has effectively given us the best possible endorsement of the quality of our management, operations and business plan – and the statistical expertise that allows us to be confident in predicting profitable underwriting results.”

The syndicate’s announcement indicated that “In the year to date we have seen an average 38 per cent increase in profitability over last year. We now anticipate that certain classes including international personal accident, international property, UK personal lines and excess of loss reinsurance will outperform this average. These classes will be the principal beneficiaries of this additional capital.”

Berkshire Hathaway’s commitment is a tribute to the Euclidian Group’s success, and a vote of confidence in the Lloyd’s market. The company is a fully integrated, globally licensed insurer, rated A- (Excellent) by A. M. Best. It does business in 42 countries and writes 500,000 policies in the UK annually.

The bulletin stated that It’s Syndicate 1243 “has been among the top three best performing corporate composite syndicates since it commenced underwriting in 1998,” and that “Euclidian Underwriting has been among the top 10 best performing corporately owned managing agents since establishment in 1998.”

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