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What can Lloyd’s offer today’s Investors?

The single most significant attraction to underwriting at Lloyd’s remains the potential to use certain investment assets twice.  The collateral to support underwriting does not have to be paid up in advance in cash but can be provided via a bank guarantee or letter of credit secured on a portion of an existing investment portfolio.   For example, this can enable investors to retain income and gains on a portfolio of property outside of their principal private residence whilst also benefiting from insurance returns from Lloyd’s. When used in a qualifying trade such as Lloyd’s, the same assets may also benefit from Business Property Relief for inheritance tax purposes, making Lloyd’s vehicles an interesting estate planning consideration.

In addition to a double use of assets, Lloyd’s investments exhibit a low correlation with other more traditional assets and therefore can provide valuable diversification for investors seeking to spread risk amongst alternative asset classes.