Moody's Investors Service may downgrade Cotesworth Lloyd's syndicate 535, following news that its parent company has appointed a provisional liquidator, KPMG.
HIH, the insurer that provides 85% of the funding for the syndicate, had its shares suspended on the Australian stock exchange this month.
It was thought to have made losses of
Aus$800m (£285m) for the half year to end December and may now run into liquidation.
Syndicate 535 is an energy-oriented marine syndicate and merged for this year with Cotesworth syndicate 228, which mainly writes hull insurance.
But Moody's has now placed Cotesworth syndicate 535, which currently has a rating of B average, under review.
It believes the syndicate is unlikely to be backed by HIH next year, despite its good track record. If HIH does go into liquidation, Cotesworth will need to find alternative
Cotesworth has now written a letter to brokers, claiming HIH's need for a provisional liquidator will not affect either of the syndicates' business.
Deputy chairman and managing director Norman Britten said: “I wish to emphasis that this appointment does not affect Cotesworth's ability to continue to trade.”