The practice of syndicates at Lloyd's of London by which future liabilities for policies are carried over to a new year. Syndicates of investors at Lloyd's have to renew their legal status every year by reforming as a new syndicate (usually with the same members). Before the end of each year syndicates must cover any future liabilities for policies written during that year. They therefore reinsure such outstanding policies by means of a premium with the newly formed syndicate; this practice is known as reinsurance to close.
Subjects: Financial Institutions and Services.