ERS has released the result of Syndicate 218’s 2014 account as well as providing an update of the 2015 account as follows:

 

Year of
account

Capacity
£000s

Result/Revised
forecast range

Previous Forecast
Range

Change at
Midpoint

2014

437,522

-4.7% loss

-8.6% to 1.4%

1.2 points worse

2015

349,828

-9.9% to 0.1%

-2.9% to 7.1%

7.1 points worse

2016

360,098

No Forecast at this stage

   

The syndicate has re-evaluated reserving in the light of the recent announcement by the Lord Chancellor that changed the discount rate (also known as the Ogden rate) used by courts in setting lump sum compensation awards for serious bodily injury cases. This change impacts the most serious claims that are exposed to the syndicate reinsurance programme, although the net position is a deterioration of 3.7% of capacity owing to this issue.

There is also a deterioration on the 2015 forecast which has moved from a profit at midpoint to a loss. Part of this is attributed to the change to the Ogden rate but there is also claims inflation, some of which is attributed to the increasing cost of damage claims following the recent fall in the value of sterling.

The full list of results received to date is attached here. QBE Syndicate 386, which is re-evaluating its reserves in the light of the Ogden rate change, is now the only syndicate for which a result is awaited.

All results and forecasts are expressed as a percentage of syndicate capacity and are after all standard personal expenses other than members’ agents’ fees and charges.