Ratings agency Moody's has changed its outlook to negative for the two Lloyd's syndicates of Hiscox (33) and Kiln (807).

The ratings specialist has awarded Hiscox syndicate 33 a rating of A- after it forecast losses of 7.5% to 12.5% for 1998 and 6.5% and 11.5% for 1999.

However, Moody's expects syndicate 33, which has a capacity of £360m, to outperform the Lloyd's market in the longer term because it benefits from a large book of diversified business, sound management and Hiscox capital backing.

Moody's said its B+ rating for Kiln non-marine syndicate 807 follows forecast losses of between 11.1% to 16.1% in 1998 and 3.6% to 8.6% for 1999.

But Moody's said the syndicate, with a capacity of £45m, was likely to recover in the longer term.