Lloyd's insurers are showing signs they have doubts over doing business in the 300-year-old market. Concerns over the commitment of Faraday Underwriting to Lloyd's led to its financial strength rating being placed on negative outlook.

Lloyd's insurers are showing signs they have doubts over doing business in the 300-year-old market.

Concerns over the commitment of Faraday Underwriting to Lloyd's led to its financial strength rating being placed on negative outlook.

Faraday's syndicate 435 was placed on negative outlook by Moody's.

The rating agency explained in a statement that it made its move on 27 November "in light of concerns over Faraday's commitment to the Lloyd's Market".

Faraday chief executive Nigel Barton said the company also had a "question mark" over its operation.

He said: "Our owners and most of the general trade capital providers are having constructive dialogue with Lloyd's about its future.

"If that dialogue was not to be fruitful then we, like other trade capital providers, have other options. But we are very much working with Lloyd's to help shape its future."

Other Lloyd's operators showed enthusiasm for increasing their capacity for writing business outside the market.

Wellington Underwriting said it was preparing to receive up to £400m of investment, but that the money would be spent on setting up a new insurance company rather than on Lloyd's capacity.

Fellow Lloyd's-based group Goshawk Insurance took its first step outside the UK to launch a new vehicle in Bermuda rather than in London.

After the largest share offering in the company's history, Goshawk finance director Chris Fagan said it would be "more efficient" to use the money raised outside Lloyd's.

He said: "We estimate the transactional costs of putting a piece of business through our new Bermuda operation will be 4% lower than it will at Lloyd's.

"In Bermuda, the regulatory environment will allow us to use the capital more efficiently."

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