LLM1095 - Introduction to Lloyd's: basic concepts and terms: managing agents and premium trust funds: aligned member syndicates

With effect from 1 July 2007, aligned corporate member syndicates may hold “member capital” in the syndicate premium trust fund. This capital would formerly have been held by the member in its Personal Reserve Fund and forms part of Funds at Lloyd’s (see LLM1200).

This Lloyd’s practice change was designed to recognise the commercial alignment between member and managing agent, simplifying the trustee arrangements, reducing the need for transfers between funds and facilitating trust asset management. Special tax treatment is needed to apply the correct basis of assessment, distinguishing between profits arising on member capital and that arising on ordinary syndicate capital – see LLM4105.