Underwriting agencies

The underwriting agency always acts for and on behalf of the insurer/s that delegate/s the authority to bind risks. Consequently, the insurers are the one assuming directly the risks.

A binding authority is the English name of the power that an insurance entity/Lloyd’s Syndicate grants in favour of the underwriting agency.

The binding authorities of the Lloyd’s coverholders define in depth the legal relationship between the Lloyd’s Syndicate and the underwriting agency. Hence, it details the risks that the underwriting agency may write; its the terms and conditions as well as the financial, temporary and material limits. It also identifies the individuals who are empowered to bind insurance, regulate the fees and commissions, the information and reporting duties, the claims handling and, even, the applicable taxes and charges.

Coverholder Appointment Agreement (CAA) is the English name given to the agreement of delegated authority granted by Lloyd’s Insurance Company to an underwriting agency. The CAAs of Lloyd’s Europe define in depth the legal relationship between Lloyd’s Insurance Company SA and the underwriting agency. Hence, a CAA would detail the risks that the underwriting agency may write and under which terms and conditions; the financial, temporary and material limits; the individuals who are authorised to bind insurance; the fees and commissions; the information and reporting duties; the claims handling procedure and, even, the applicable taxes and charges.

Yes. Prior to start the activity, the underwriting agencies must obtain an administrative license from the Spanish DGS.

In order to obtain and keep the license, the underwriting agencies must serve an application before the DGS and demonstrate that they meet the legal requirements.

No. Nowadays, the only way to obtain information about the Spanish underwriting agencies is through the Registry of Insurance Entities, which is available at the DGS’s website.

Lloyd’s keeps information of its approved underwriting agencies/coverholders. You may either visit www.lloyds.com or approach Lloyd’s Iberia, the representative office of Lloyd’s in Spain.

Yes. Art. 60 of the Law 20/2015 of 14 July, which regulates the underwriting agencies, expressly provides that the underwriting agencies may act on behalf of one or more insurers.

Yes. The underwriting agencies can enter into letter of terms (“cartas de condiciones”) with brokers and broking firms. For transparency and legal certainty reasons, the letter of terms should clarify the fact that the underwriting agency operates and write risks for and on behalf of the insurer granting the binding authority.

The operative of an underwriting agency depends on its type of power or CAA. There are wide authorisation powers and others requiring prior acceptance from the insurer before underwriting risk.

Generally, an underwriting agency shall have faculties to analyse the risks to be insured, quote them, discuss covers, take decisions about the acceptance and underwrite the risks as well as to prepare and issue the contracts of insurance and, together with the intermediary, take care of the premium collection and the administration of the contract.

The underwriting agencies have delegated powers for the handling, negotiation and settlement of claims. In some cases, they have authority for handling and settling them directly (always under an agreed limits); in other cases, the underwriting agencies should obtain the authorisation of the insurer on whose behalf they operate.

In case of a claim, the role of the underwriting agency is always to make possible that that the claim was handled in the quickest and most efficient way.

Yes. The client that insures the risks through a Lloyd’s underwriting agency, which is duly licensed by the DGS, enjoys the same protection and rights than if taking over the policy directly with the insurer.

The insurers’ customer service departments shall deal with and resolve any complaints or claims that may be submitted in connection with the activity of underwriting agencies. In the event of legal actions, the competent court will be, in the majority of cases, the one of the insured’s domicile.

The Lloyd’s underwriting agencies offer a complete and high quality service, tailor-made solutions and high specialisation. As they hold binding authorities, the underwriting agency issues the contract of insurance INMEDIATELY, always provided that the risk was accepted and was within the binder’s limits.

The Lloyd’s underwriting agencies mean an alternative for the insurance intermediaries to access to the specialisation, unique solutions and insurance capacity of the Lloyd’s insurance market. All the foregoing, in YOUR LANGUAGE, in a friendly and simple way and with the maximum guarantee and legal security.

In conclusion, immediate issue of policies, an agile and high quality service, tailor-made solutions, specialisation and access to Lloyd’s are the added values that the Lloyd’s underwriting agencies offer.