Capacity supplied by Lloyd's Names with limited liability status will jump by 55% next year to £1.119 billion, while a number of Names who withdrew due to losses are "discussing" their return.
The Association of Lloyd's Members (ALM), which represents the majority of Names, says the increase in capacity from limited liability Names (from £722 million) indicates that there is still a deep-rooted commitment to the market amongst Names.
The more traditional unlimited liability status of Lloyd's Names makes it difficult to attract rich investors because of fears they could lose everything to a run of bad claims. Limited liability removes that concern.
"Names who were planning to leave Lloyd's would not go through the expensive and inconvenient process of conversion [to limited liability]," said ALM chairman Michael Deeny.
However, the overall level of capacity supplied by Names is set to dip to £3.2bn in 2000, compared with £3.4bn this year. The ALM claims this is a stabilised figure – more than £600 million of Names' capacity was lost between 1998 and 1999 – which will provide a platform for future growth.
"As trading conditions improve, Names old and new will increase their capacity to replace some of the corporate capacity that is now withdrawing after significant losses," said Deeny.
