Lloyd's has issued a market bulletin giving details of the arrangements relating to mid-year coming-into-line (click here to see a copy). The bulletin is addressed both to members' agents and to direct corporate members.
Coming-into-line and release statements will be available from Market Services on 17 April 2009, with coming-into-line shortfalls required to be made good not later than 30 June 2009. Members with a shortfall of less than 10% of their Economic Capital Assessment or (if greater) their minimum capital requirement will not be required to provide additional funds (provided that the shortfall does not exceed £100,000).
Syndicate ICAs have been adjusted to 31 December 2008 rates of exchange (that is £1 = US$1.44) and funds at Lloyd's will be valued at the same date.
Lloyd's will charge £52 per £5m shortfall, or part of £5m, per day from 1 July until the shortfall is cleared. If members remain out of line by 31 July, then their 2010 overall premium limit (OPL) cannot be greater than their 2009 OPL. The member will be able to trade in the auctions, but subject always to that cap on his OPL, with the member being obliged to drop any surplus capacity at nil value.
The coming-into-line date for 2010 is Thursday 26 November 2009