At Lancashire, we value our relationships
and believe that success is unlikely to be
achieved without a significant amount
of effort put into those relationships.
These relationships encompass brokers,
employees, regulators, rating agencies,
the community, analysts and others.
All such relationships are highly valued.
Brokers
It is difficult to overstate the importance
of broker and customer relationships.
Our business is almost all transacted
through brokers. Brokers need to know
that insurers of their clients have excellent
financial strength, a thorough understanding
of the risks at hand, and a willingness and
ability to provide first class service.
Lancashire strives to meet all of these
requirements handily. More than ever we
are placing greater emphasis on marketing,
which we believe will continue to afford
us access to virtually all major risks placed
in the market in the classes underwritten
by Lancashire.
Employees
At March 2009, Lancashire had 91
employees; 47 in London, 41 in Bermuda
and 3 in Dubai.
Lancashire is an equal opportunity
employer, and does not tolerate unfair
discrimination of any kind in any aspect
of employment, including recruitment,
training, promotion, compensation,
benefits, career development and
advancement. The Group believes that
education and training for employees is
a continuous process and employees are
encouraged to discuss training needs with
their managers. The Group’s health and
safety, equal opportunities and other
policies are available to all employees
in the staff handbook, which is on the
Group’s intranet.
We take staff retention seriously as
we think that staff who understand
our business are best placed to ensure
Lancashire’s continued success. We also
believe that as many employees as possible
should become shareholders in Lancashire.
3.95 per cent of our fully diluted share
count is represented by staff through
shares or options. All Lancashire staff with
greater than a year’s service are owners of
Lancashire’s shares through actual share
holdings or through warrants, options
or restricted stock. This creates great team
spirit and has been an important part
of Lancashire’s success to date.
Regulators
We place high importance on our
relationship with regulators and we
monitor changes in regulatory
requirements closely. Both our Bermuda
insurance operations (regulated by the
Bermuda Monetary Authority (BMA))
and our UK insurance operations
(regulated by the Financial Services
Authority (FSA)) are subject to routine
regulatory reviews, although no such
reviews were conducted during 2008.
Our marketing company in Dubai
is regulated by the Dubai Financial
Services Authority (DFSA).
Lancashire has also obtained eligibility
as an excess and surplus lines insurer
in many U.S. states. As at March 2009,
LICL and LUK were eligible for surplus
lines insurance and reinsurance in 44 and
42 U.S. jurisdictions respectively, but are
not licensed insurers in any U.S. state or
territory. For those U.S. states where LICL
or LUK is not currently excess and surplus
lines eligible, Lancashire, subject to
compliance with applicable law and
regulation, may write insurance on a direct
procurement basis or take advantage
of appropriate exemptions.
Rating agencies
Lancashire enjoys a positive relationship
with rating agencies. The Group has
a financial strength rating of A minus
(Excellent) with a stable outlook from
A.M. Best. This rating is sufficient to allow
the Group to trade successfully in all the
major global insurance markets. It is also
in discussion with Standard & Poor’s
(S&P) and Moody’s with a view to
obtaining satisfactory ratings from them
in due course.
Investor relations
In June 2008, Lancashire appointed
a full-time Head of Investor Relations
and Marketing who has been focusing
on developing our relationship with
investors, potential investors and analysts.
A significant number of investor meetings
in the UK and U.S. as well as Investor
Days in New York and Boston, presenting
to analysts, sales teams, investors and
potential investors were held during
the latter part of 2008.
Lancashire’s shares are to be admitted
to the Official List and to trading on
the main market of the London Stock
Exchange (the “Main Market”) under the
ticker symbol LRE.L on 16 March 2009.
In the community
Lancashire set up the Lancashire
Foundation, a Bermuda charitable trust in
2007 with the aim of creating a charitable
trust for the benefit of charitable causes in
Bermuda and elsewhere (the “Foundation”).
The Foundation’s trustee is an independent
third party professional trust company that makes donations following
recommendations as made by the
Company’s Donations Committee
consisting of Lancashire employees and
independent members. Specific criteria
have been set for the Foundation’s
charitable giving. These criteria include
causes where Lancashire staff or
independent Donations Committee
members have a close relationship
with those who operate the charity
and therefore have the ability to monitor
and influence outcomes.
In 2008 the Group supported The
Sunshine League, The Family Centre
and BASE (Bermuda Autism Support &
Education Society) in Bermuda and, in
recognition of the fact that a significant
element of Lancashire’s business is
connected to insuring against natural
catastrophes, the decision was taken
to support Médecins Sans Frontières,
a charity that the Foundation views as
well equipped to provide immediate and
lasting humanitarian aid to people directly
affected by such catastrophes due to its
international presence.