Standing room only at Lloyd’s as demand for desks reaches all-time high

There has been a surge in global demand from insurers

The Lloyd’s of London insurance market is facing its longest-ever waiting list for seats in its building amid a surge of mergers and acquisitions activity.

The 327-year-old institution, currently based at 1 Lime Street in the so-called “Inside-out building”, confirmed there was a waiting list of 160 for seats at its desk units, known in the trade as boxes.

This is the highest level in its history, and underscores a surge in global demand from insurers for a spot in the building, one of the last face-to-face financial markets in the world.

The list is mainly comprised of either new groups of insurers wishing to take space in the building, or companies looking for extra seats after expanding through mergers and acquisitions.

The building has 2,900 seats over four floors, with the first storey deemed the most highly prized spot given its proximity to the Lutine Bell, considered the symbolic heart of the Lloyd’s insurance market. Insurers such as Beazley, Brit and Amlin are just some of the firms with central spots here.

Groups of underwriters based on the first floor pay a premium on top of an annual rent rate paid to Lloyd’s to secure a seat. Rents are paid based on how many square feet they take up.

The rented seats are situated in the wooden boxes, which are equipped with computers and telephones.

Each box is branded with the name of the underwriter – known as a syndicate – who takes space in the box. There are 97 syndicates at Lloyd’s.Some veterans of the market hark back to years when boxes were unbranded – but now neon-backed signs and chairs embossed with the underwriters’ logos populate the space, although there is a still strict policy on how the boxes should look.

The emergence of the lengthy waiting list comes after Lloyd’s reported a drop in pre-tax profits to £1.19bn, from £1.65bn the previous year, and a lower return on capital.

Insurance companies have been laid low by a wave of extra capital, which is having an impact on prices and driving mergers and consolidation in the industry.

Last month the Japanese firm Mitsui Sumitomo Insurance made a £3.5bn offer for Amlin, while another insurer, Catlin, was snapped up earlier this year by rival XL.

Brit Insurance was also sold recently for £1.2bn to the Canadian firm Fairfax, and the Lloyd’s insurer Canopius fell to the Japanese buyer Sompo in 2013.