| Accredited investor | a) an individual who has attested that their net worth, or joint net worth with their spouse, exceeds $1,000,000; or b) an individual who in each of the two most recent years, has individual income in excess of $200,000, and has a reasonable expectation that their individual income in the current year will be in excess of $200,000; or c) an individual who in each of the two most recent years, has joint income with their spouse in excess of $300,000, and has an expectation that their joint income with their spouse in the current year will be in excess of $300,000. |
| Adjusted ECA | in respect of a member, the ECA for that member as increased by a Capital Loading. |
| Administrative fine | an administrative fine levied by the Council pursuant to the Enforcement Byelaw (as amended).
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Aggregate Capital
| the aggregate of a member’s FAL and/or FIS (if applicable) and the member’s share of the assets held in the managing agent’s sub-fund(s) under the member’s premiums trust deed. |
Alternative Asset
| Funds that do not fall under conventional investment categories (e.g. equity, fixed income, securitisations and cash), but where the fund can be realised for cash within 90 days, without significant loss in fair market value. For alternative fund investments members must perform full look-through reporting, in line with Solvency II reporting requirements, of underlying asset line items and be comfortable they meet Prudent Person Principle requirements. Examples include hedge funds (CIC 46), real estate investment trusts (CIC 45) and commodity funds (CIC 46). |
| Annual CIL Date | Working Day 55 in Q2. |
| Annual CIL Statement | the statement issued by the Society on Working Day 35 setting out the member’s capital position and any funding requirement. |
| Approved Credit Institution | a credit institution that has been approved by the Council in accordance with the ‘Criteria to be Applied in the Approval of Credit Institutions’, as made by the Council from time to time. |
| Approved stock exchange | the principal stock exchange in each EEA State and each OECD member country, the principal stock exchange in each of Hong Kong, Malaysia, Singapore and SouthAfrica and any other stock exchange as may from time to time be added to this list by an authorised person. Assets in FAL that are traded on an approved stock exchange must be in an acceptable currency ([sub-paragraph A. in Consolidated Requirements Part 1 > Becoming a Member > Funds at Lloyd’s > Members capital – acceptable assets > Acceptable currencies]). |
| Auditor | a person having qualifications acceptable to the Council to act as auditor to corporate candidate or corporate member; |
Authorised person
| in relation to any provision in these requirements, the Council or any subcommittee or officer or employee of the Society authorised by the Council to discharge the duties and functions or to exercise the powers and discretions specified in that provision. |
| Capital Loading | an additional capital loading imposed on a member pursuant to paragraph [D. in Consolidated Requirements Part 1 > Becoming a Member > Funds at Lloyd’s > Members capital – acceptable assets > Strategic Asset Allocation Requirements]. |
| Capital Test | a comparison of the member’s assets held by the member at a particular point in time against the member’s Adjusted ECA. |
Capital Uplift
| the percentage uplift applied to the SCR to determine a member’s ECA, the amount of which is subject to annual review and will be published by Lloyd’s via the FAL Online portal. |
| CIL | coming into line.
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| Collective Investment Undertakings | those assets categorised as such in Appendix 4 of these conditions and requirements. |
Company candidate
| a corporate candidate which complies with [Consolidated Requirements Part 1 > Becoming a Member > Application requirements and documentation > Company applicants]. |
| Corporate candidate | an entity applying for membership of the Society and which is either a company candidate or a LLP candidate. |
| Corridor Test Deadline | in relation to a quarter, Working Day 55 in that quarter.
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| Cut-Off Date | in any one year, Working Day 25 in Q4, or such other date as the Council may from time to time prescribe. |
Definitions Byelaw
| the Definitions Byelaw (No. 7 of 2005) (as amended from time to time). |
| De Minimis Amount | means £1 million (or such other amount as determined by the Council from time to time). |
Double taxation arrangements
| arrangements that have effect under section 2(1) of the Taxation (International and Other Provisions) Act 2010. |
| ECA/Economic capital assessment requirement | means in relation to a member or a participant, the amount required by the Society in accordance with its economic capital assessment model, as from time to time varied or supplemented, of the capital resources required to support the insurance business of the member or of the participant. The ECA may be revised by the Society (i) to take account of revised FX rates, for the purposes of the corridor tests under paragraph 2.5A – C [of the Membership & Underwriting Conditions and Requirements], and (ii) in the event of an additional capital test under the provisions of paragraphs 2.5L – O [of the Membership & Underwriting Conditions and Requirements]. |
EIOPA CIC codes
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the codes set out in Appendix 4 [to the Membership & Underwriting Conditions and Requirements]. |
| FAL | Funds at Lloyd’s. |
| FAL Online portal | the online tool by which members and Third Party Capital Providers can access details of and give instructions in respect of FAL provided by them. |
| FCA | Financial Conduct Authority. |
| FIS | Funds in syndicate. |
| Fund | collective investment scheme (CIS), i.e. any arrangement with respect to property of any description, including money, the purpose or effect of which is to enable persons taking part in the arrangements (whether by becoming owners of the property or any part of it or otherwise) to participate in or receive profits or income arising from the acquisition, holding, management or disposal of the property or sums paid out of such profits or income. |
| Guarantee | A guarantee that complies with the requirements set out in [Consolidated Requirements Part 1 > Becoming a Member > Funds at Lloyd’s > Members capital – acceptable assets > Acceptable Assets within FAL]. |
| Illiquid Asset | assets or Funds invested in assets including, but not limited to, Private Equity, Private Credit, Direct Real Estate and Infrastructure, and any other assets or Funds which cannot be easily realised for cash within 90 calendar days, without a significant loss in fair market value, or that cannot be accurately and fairly valued. This means that dealing points cannot be less frequent than quarterly, with a maximum notice period of 180 calendar days. Settlement cannot be less frequent than 45 calendar days after dealing. This does not include investments in a Fund portfolio with the following characteristics: (a) no asset is more than 5% of the Fund portfolio; (b) the Fund portfolio has an average duration of less than 90 calendar days; and (c) over 50% of the investment can be redeemed within 180 calendar days. |
| Ineligible group | a group which includes a corporate member or an underwriting agent where the turnover of the corporate member or the underwriting agent is greater than 5 per cent of the turnover of the group as a whole. |
| Interavailability arrangement | means an arrangement whereby: a) a member ceases to underwrite insurance business at Lloyd’s; and b) its Lloyd’s deposit or its Lloyd’s life deposit is held so as to provide security both for its past underwriting business at Lloyd’s and the future underwriting business of a successor member whether by way of variation or modification to the trusts, powers, terms, conditions and other arrangements under which its Lloyd’s deposit or its Lloyd’s life deposit is held; |
| Lloyd's obligations | in relation to any member, all underwriting obligations incurred by the member as an underwriting member, including obligations to the Society and to the trustees of any trust deed under which any part of the member's FAL are held and obligations arising under: a) any byelaw, regulation, rule, direction or other requirement of the Society; and b) any deed, contract, instrument or other arrangement of any kind approved by the Society; but does not include obligations arising in respect of any letter of credit, guarantee or other security given to secure the performance of any of the member's underwriting obligations in favour of the person giving such guarantee or other security. |
| Legal adviser | a person having qualifications acceptable to the Council to act as legal adviser to a corporate candidate or corporate member. |
| LFOA | Lloyd’s form of appointment. |
| Limited partner | an individual or company which is registered as a limited partner of a SLP pursuant to the Limited Partnerships Act 1907. |
| LLP | A limited liability partnership incorporated under the Limited Liability Partnerships Act 2000. |
LLP candidate
| a corporate candidate which complies with [Consolidated Requirements Part 1 > Becoming a Member > Application requirements and documentation > LLP applicants].
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| LOC | letter of credit that complies with the requirements set out in [Consolidated Requirements Part 1 > Becoming a Member > Funds at Lloyd’s > Members capital – acceptable assets > Acceptable Assets within FAL]. |
Managing agent’s sub-fund
| in relation to a member, has the meaning given in that member’s premiums trust deed. |
| Master Agreement | an agreement between Lloyd’s and an investment manager which provides for the entering into of agreements by which the investment manager can be appointed to manage the investment of FAL provided by a member or depositor.
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Member Services
| The department at Lloyd’s by that name (or any successor thereto). |
| Member’s assets | has the meaning given in [Funds at Lloyd’s > Members capital – provision and maintenance > Member’s assets]. |
| Membership Agreement | the Lloyd’s Membership Agreement in the relevant prescribed form executed by a corporate member on its admission to membership of Lloyd’s. |
Membership Byelaw
| the Membership Byelaw (No. 5 of 2005) (as amended from time to time). |
| Membership and Underwriting Requirements (Corporate Member) | the conditions and requirements so-called and made under the Membership Byelaw (No.5 of 2005) and for the time being in force. |
| Mid-Year Cut-Off Date | in any one year, Working Day 22 in Q2, or such other date as the Council may from time to time prescribe. |
| OPL | overall premium limit. |
| Overdue Notice | the notice issued by the Society to a member to advise that the member has not met their funding obligation at either the Annual CIL Date or quarterly Corridor Test deadline. |
Participant | a member of Lloyd’s (other than the successor member) which takes part in an interavailability arrangement including in circumstances where, as a result of paragraph [C. in Consolidated Requirements Part 1 > Becoming a Member > Funds at Lloyd's trust deed requirements > Interavailable Trust Deeds], the assets in question are treated as no longer being held on interavailable terms. |
| PRA | Prudential Regulation Authority. |
| PRF | the personal reserve sub-fund under the premiums trust deed. |
Quarterly Amendment Period
| a) in Q1 and Q3, the period between Working Day 35 and Working Day 55 of each quarter; b) in Q2, the period from the commencement of Q2 to the Mid-Year Cut-Off Date; c) in Q4, the period from the commencement of Q4 to the Cut-Off Date. |
Relevant valuation date
| a) in the case of a corporate member which wishes to commence underwriting insurance business at Lloyd’s on a date prior to 1 January next following its admission to membership of the Society, the date on which that member provides FAL; b) in relation to the Annual CIL Date, 31 December in the previous calendar year; c) in any other case: i. as may be prescribed next before the CIL date; or ii. where assets are received after the valuation date referred to in (i), the date on which they are paid or transferred to the trust fund concerned; |
| Request for Funds | a request for funds made by the managing agent of a syndicate under any standard managing agent's agreement (general) or any standard managing agent’s agreement (corporate member). |
| Resident in the United Kingdom for tax purposes | (i) in the case of an individual, as determined in accordance with the provisions of the Finance Act 2013, and (ii) in the case of a company, as determined in accordance with the provisions of the Corporation Tax Act 2009 and any applicable double taxation arrangements.
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| SCR | solvency capital requirement, as defined in paragraph [A. in Consolidated Requirements Part 1 > Becoming a Member > Funds at Lloyd’s > Members capital – provision and maintenance > Provision of capital]. |
| SLP | Scottish limited partnership.
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| Solvency statement | has the meaning given in paragraph 1 of the Definitions Byelaw. |
| SRF | Special Reserve Fund. |
| SSAA | the standard strategic asset allocation set out in [Appendix 3 to the Membership & Underwriting Conditions and Requirements]. |
| Successor member | in relation to an interavailability arrangement including an arrangement where, in accordance with paragraph [C. in Consolidated Requirements Part 1 > Becoming a Member > Funds at Lloyd's trust deed requirements > Interavailable Trust Deeds] the assets in question are treated as no longer being held on interavailable terms, a corporate member which will continue to underwrite for the next following year of account and to which the Lloyd’s deposit or Lloyd’s life deposit of one or more participants is made interavailable or which, in accordance with [C. in Consolidated Requirements Part 1 > Becoming a Member > Funds at Lloyd's trust deed requirements > Interavailable Trust Deeds] is in included in the FAL of the corporate member; |
| Tax Year | (i) in the case of an individual, the period from 6 April to the following 5 April, and (ii) in the case of a company, the calendar year.
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Third Party Capital Provider
| a person (other than the member) approved by the Society to provide assets to be held in a member’s FAL and who has entered into the appropriate form of Lloyd’s trust deed.
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US person | (i) any natural person resident in the United States; (ii) any partnership or corporation organised or incorporated under the laws of the United States; (iii) any estate of which any executor or administrator is a US person; (iv) any trust of which any trustee is a US person; (v) any agency or branch of a foreign entity located in the United States; (vi) any non-discretionary account or similar account (other than an estate or trust) held by a dealer or other fiduciary for the benefit or account of a US person; or (vii) any discretionary account or similar account (other than an estate or trust) held by a dealer or other fiduciary organised, incorporated, or (if an individual) resident in the United States. |
Working Day
| a day other than a Saturday, Sunday or public holiday in England. |
| Year of account | an accounting year at Lloyd’s.
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