Insurance News

Florida allows Lloyd’s to provide reinsurance under relaxed capital rules

Posted on: October 15, 2011

TALLAHASSEE, Fla.—Lloyd’s of London has received permission to operate as a reinsurer in Florida under relaxed collateral rules, according to the Florida Office of Insurance Regulation.

“Lloyd’s is committed to providing insurance and reinsurance to protect people and businesses in Florida,” Sean McGovern, general counsel and director of Lloyd’s America, said Thursday in a statement. The state and its insurance office “have given us a clear signal that Florida is pro-business and actively encouraging investment,” he said.

Lloyd’s received similar permission from New York state in July.

A Florida rule that had required non-U.S.-based reinsurers to post collateral equal to 100% of their U.S. claims liabilities was relaxed in 2008 in the catastrophe-prone state, allowing highly rated and financially sound companies to post collateral equal to 20% of their loss reserves on Florida property catastrophe reinsurance.

17th in Florida

Lloyd’s is the 17th reinsurer operating in Florida approved to operate under the reduced capital requirement.

Other reinsurers to receive similar approval in recent months include Hamilton, Bermuda,-based Alterra Bermuda Ltd. and XL Re Ltd., a unit of XL Capital Ltd.

Copyright © 2011. Crain Communications, Inc.

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