Lloyd's managing agent Abacus is set to launch a professional indemnity (PI) syndicate.

The Lloyd's franchise board has given conditional approval for Syndicate 2526, which will commence underwriting on 1 January 2004.

The active underwriter will be Andy Doré, formerly head PI underwriter with PRI.

The syndicate will have a capacity of £40m, 90% of which will be focused on SME risks in the UK.

Abacus chief operating officer Ian Bremner said: "The prime objective is to create a consistently profitable PI syndicate to take advantage of the current opportunities within the market without any tail from the past. There is currently a shortage of quality underwriting capacity in the market".

Meanwhile, Abacus Syndicate 2525 plans to increase its capacity from £42m to £75m in 2004.

Most of the extra capacity will be used for public liability, products liability and UK employers' liability.