Lloyd’s of London raised $1 billion in new institutional capital in 2025 through its London Bridge structure, a specialized vehicle designed to facilitate investment into the insurance marketplace, according to recent reports.
The London Bridge structure, a UK-incorporated protected cell company, offers investors a more streamlined route to participate in Lloyd’s compared to establishing a new syndicate or acquiring an existing one. It allows insurers and underwriters to access third-party capital to support their underwriting plans. Each cell within London Bridge supports a specific Lloyd’s syndicate or corporate member, with assets ring-fenced to protect against liabilities in other cells or the core London Bridge administration.
The structure’s appeal extends to asset managers seeking exposure to Lloyd’s specialist insurance business and durable asset management arrangements. Investors such as Blackstone, Oaktree and Ontario Teachers’ Pension Plan have utilized London Bridge, alongside strategic players like AIG, Beazley, and OAK Enterprise. The arrangement provides a ready liquidity solution through Lloyd’s “reinsurance to close” mechanism, a key attraction for potential investors.
London Bridge operates by channeling investment into Funds at Lloyd’s (FAL), collateral required to support underwriting. Investors may subscribe for further interests in a cell if additional FAL is needed, typically through a reinsurance agreement. Returns are then linked to the syndicate’s performance. Transactions can similarly involve direct reinsurance between a London Bridge cell and a syndicate, often structured as notes sold to institutional investors for catastrophe bonds.
Lloyd’s operates on a “year of account” basis, with each syndicate underwriting events within a specific calendar year. After three years, the year of account is closed through reinsurance to close (RITC), transferring liabilities and claims handling costs to the subsequent year in exchange for a premium. This process provides a defined exit mechanic for investors.
The structure is authorized by the UK Prudential Regulation Authority (PRA) and Financial Conduct Authority (FCA), and licensed by Lloyd’s to reinsure business and issue securities. London Bridge’s regulatory permissions allow it to offer a range of risk transfer options without requiring further regulatory approval for each transaction, provided certain mandatory terms are met in the transaction documents. This has significantly reduced the time required for investors to provide capital.
The London Bridge structure provides access to capital for insurers, exposure to specialist lines of insurance business for investors, and a convergence point for asset management within the insurance market. Fidelis, for example, launched syndicate 2126 funded by Blackstone via London Bridge, expanding its underwriting capacity. AIG and Blackstone also collaborated on syndicate 2478, utilizing the structure to support AIG’s reinsurance program and allow Blackstone to manage the syndicate’s assets.
In 2024, Beazley issued the first excess of loss catastrophe bond via London Bridge, providing $100 million of multi-year indemnity reinsurance protection for named storm and earthquakes in the U.S., Canada, and parts of the Caribbean. Beazley subsequently raised its third London Bridge natural catastrophe bond in December 2025. Lloyd’s has expressed interest in expanding the employ of London Bridge for non-property catastrophe bonds, differentiating it from markets like Bermuda, which have primarily focused on property risks.
The RITC framework, a standard practice at Lloyd’s, provides a liquidity mechanism for investors on the third anniversary of the year of account, with the premium calculation overseen by an independent party. Capital provided at Lloyd’s is available across multiple years of account, differing from other sidecar arrangements. Lloyd’s financial strength, reflected in its A+ (AM Best) and AA- (Fitch and S&P) ratings, and its unique chain of security, further underpin the structure’s appeal.
Investing through London Bridge benefits from the UK Risk Transformation (Tax) Regulations 2017, offering exemption from UK corporation tax and withholding tax on distributions to investors, provided certain conditions are met. The structure’s regulatory advantages include existing permissions from the PRA, FCA, and Lloyd’s, requiring only notification of new transactions rather than full regulatory approval, and streamlined AML checks for investors.
