Investors back potential Lloyd’s syndicate launch
Cedar Trace investors are set to provide capital for the launch of a $300 million syndicate at Lloyd’s for the 2027 underwriting year, marking the company’s first foray into the London market. The move follows in-principle approval from the Lloyd’s Council on September 2, clearing the way for Cedar Trace Underwriting to establish a diversified reinsurance and delegated direct insurance portfolio.
Expansion into Lloyd’s Market
The syndicate will be led by Richard Holden, Chief Underwriting Officer at Cedar Trace, and will operate alongside Cedar Trace’s existing Bermuda-based reinsurance and asset management platform. The company’s entry into Lloyd’s is framed as a natural progression, given its growth in the Bermuda market—where it expects to reach over $1 billion in gross written premiums by 2026.
Existing shareholders of Mereo Insurance, Cedar Trace’s affiliated reinsurer, will be the primary source of capital for the new syndicate. However, investors backing insurance-linked securities (ILS) funds managed by Cedar Trace Capital Management—including those operating through Cedar Trace ILS—will also contribute. This dual funding approach reflects the company’s strategy to leverage both traditional reinsurance capital and alternative risk transfer structures.
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While the exact funding mechanism remains unclear, industry sources suggest the syndicate could tap into the London Bridge 2 PCC structure, a vehicle previously used to finance multiple Lloyd’s syndicate launches in recent years. The structure is designed to streamline capital deployment for investors seeking exposure to the market.
A Team with Lloyd’s Experience
The syndicate’s leadership draws on deep Lloyd’s expertise. David Croom-Johnson, a veteran of the market, will serve as executive chairman, while Brian Duperreault, CEO of Cedar Trace Capital Management, emphasized the team’s ability to bring “new relationships, new business, and new capital” to the market.
Duperreault noted that the $1 billion gross written premiums target in Bermuda by 2026 positions the company well for further expansion. The Lloyd’s syndicate will complement Cedar Trace’s existing operations by broadening its underwriting capabilities and potentially serving as an additional origination channel for its ILS strategies.
Richard Holden highlighted the advantages of Lloyd’s’ licensing and capital framework, which will allow Cedar Trace to deepen relationships with existing reinsurance partners while attracting new delegated coverholders. The syndicate’s focus on a diversified portfolio, spanning both reinsurance and direct insurance, aligns with broader industry trends toward integrated risk solutions.
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Support from Managing Agency and Market Reactions
Asta, which will provide managing agency services for the syndicate, welcomed Cedar Trace’s entry, citing the strength of its team and innovative capital approach. The syndicate’s launch also signals a shift in how ILS investors engage with traditional reinsurance markets. By contributing capital to the Lloyd’s venture, these investors gain indirect exposure to underwriting operations, blending their usual focus on catastrophe bonds and collateralized reinsurance with direct market participation.
This model mirrors past collaborations where ILS funds have backed Lloyd’s syndicate launches, though the specifics of Cedar Trace’s funding, whether through London Bridge 2 PCC or another structure, remain unresolved. The company’s ability to secure approval and capital reflects its growing influence in both Bermuda and London markets.
The syndicate’s planned launch in 2027 suggests a deliberate pace, allowing time for finalizing capital arrangements and market positioning. If executed, it would position Cedar Trace as a bridge between traditional reinsurance and alternative risk transfer, a role increasingly in demand as insurers seek flexible capital solutions.
