INSPRU 8.2 Special provisions for Lloyd's

The Society must establish and maintain effective arrangements to monitor and manage risk arising from:

1. (1)

   conflicts of interest (including in relation to (2) to (4));

2. (2)

   inter-syndicate transactions, including reinsurance to close and approved reinsurance to close;

3. (3)

   related party transactions; and

4. (4)

   transactions between members and itself.

The Society must take all reasonable steps to ensure that each member:

1. (1)

   executes the appropriate Lloyd's trust deeds; and

2. (2)

   carries to the appropriate Lloyd's trust fund all amounts received or receivable by the member, or on its behalf, in respect of any insurance business carried on by it.

The Society must carry all amounts it receives on behalf of any member in respect of that member's insurance business to the appropriate Lloyd's trust fund.

A managing agent must carry all amounts it receives on behalf of any member in respect of that member's insurance business to the appropriate Lloyd's trust fund.

In complying with INSPRU 8.2.19 R to INSPRU 8.2.21 R, the Society and managing agents must take all reasonable steps to ensure that amounts received or receivable by a member in respect of general insurance business and long-term insurance business are carried to separate Lloyd's trust funds.

The Society must, as soon as it is practical to do so, notify the appropriate regulator of its intention to approve the form of any new Lloyd's trust deed.

The Society must, as soon as it is practical to do so, notify the FCA of its intention to make any amendment which may alter the meaning or effect of any byelaw, including:

1. (1)

   any Lloyd's trust deed;

2. (2)

   any standard form letter of credit prescribed by the Society from time to time; or

3. (3)

   any standard form guarantee agreement prescribed by the Society from time to time.

The Society must provide the FCA with full details of:

1. (1)

   the form of any new Lloyd's trust deed it intends to approve, as described in INSPRU 8.2.23 R and

2. (2)

   any amendments falling within INSPRU 8.2.24 R.

The Society must consult interested parties in relation to any new Lloyd's trust deed and in relation to any amendment falling within INSPRU 8.2.24 R.

The information provided to the FCA by the Society under INSPRU 8.2.25 R must include:

1. (1)

   a statement of the purpose of any proposed amendment or new Lloyd's trust deed and the expected impact, if any, on policyholders, managing agents, members, and potential members; and

2. (2)

   a description of the consultation undertaken under INSPRU 8.2.26 R including a summary of any significant responses to that consultation.