Agreement under which several underwriters authorize one of them to commit their capacity on a class of risks, presenting the broker with a single large line.
A broker who has to assemble fifteen underwriters to place a risk pays for that fragmentation in delay and parallel negotiation. A consortium compresses the queue. Several underwriters sign an agreement under which one of them, the consortium leader, receives the power to commit their capacity on a defined class of risks, following underwriting rules agreed in advance. The broker presents the risk once and obtains a single line that can represent several tens of percent of the program. The mechanism differs from delegated authority in where the power comes from: here the delegation comes from other risk carriers rather than from a commercial mandate, and each remains bound in its own name for its share, with no joint liability between members. Its advantages are speed and access, a small syndicate obtaining through this channel business it would never have seen alone. Its risks are the exact converse: the following member delegates its underwriting judgment, and the quality of its book becomes that of the consortium leader, which performance monitoring must isolate and measure separately.
London market aviation consortium, 2026 year: eight carriers for a consortium capacity of 120M USD per risk, presented to the broker as a single line. A member contributing 8% of the consortium thus writes 9.6M USD per risk without having quoted a single file, and its portfolio analysis must separate that production from what it underwrites itself, on pain of believing it steers what it does not.
consortium, consortium agreement, capacité consortiale, souscription groupée