Single claim agreement party | UK Insurance Wiki

Category: Claims handling · Reviewed by Jake Leat, Associate Director · Last reviewed 2026-06-11

SCAP (Single Claim Agreement Party) is the Lloyd’s market mechanism that allows the slip leader to agree claims settlements below defined thresholds on behalf of the entire following market without seeking follower-by-follower sign-off.

Definition

SCAP is the streamlining device that makes the Lloyd’s market workable for routine and mid-sized claims. Without SCAP, every settlement would require formal sign-off from every following insurer; the administrative cost would be prohibitive. With SCAP, the leader handles routine and mid-sized claims efficiently, with follower oversight through the ECF system providing transparency without requiring sign-off for each step.

The SCAP threshold is set at slip level — typically £250,000 to £500,000 for many slips, higher for very large business. Above the threshold, formal market agreement is required.

Legal / Regulatory basis

The framework includes:

• The Lloyd’s Claim Scheme — SCAP provisions.
• The individual slip terms — SCAP threshold and any specific exclusions.
• Lloyd’s Claims Minimum Standards.
• The Insurance Act 2015.

The SCAP authority is contractual — flowing from the slip terms. Slip leaders are appointed (and SCAP authorities defined) at the inception of the slip. The Scheme provides the operational framework within which the contractual authority operates.

How it works in practice

For each new slip, the leader is identified and the SCAP threshold is set in the slip language. The threshold reflects the class of business, the size of typical claims, the size of the leader’s line (a leader with a small line may have a lower threshold than one with a substantial line), and any specific commercial agreement.

For a claim within SCAP:

• The leader handles the claim end to end.
• Reserve setting, defence strategy, settlement negotiation and settlement are all within the leader’s authority.
• Followers see the work through ECF but do not need to formally approve.
• Settlement instructions flow through the bureau accounting system.

For a claim above SCAP:

• The leader still does the substantive work.
• Before settlement, the leader seeks formal agreement from the claims market.
• The claims market is typically the second-in-line syndicate (the one with the second-largest line, or the syndicate designated in the slip).
• Above larger thresholds (often £1m+), broader market consultation may be required.

The system relies on the leader exercising authority responsibly. A leader that consistently settles at the top of SCAP without following the merits would attract follower complaint and potentially Lloyd’s central scrutiny. The leader’s reputation in the market is a substantial check on misuse.

For followers, SCAP imposes some uncertainty — they cannot control individual claim outcomes within SCAP. But they benefit from the efficient leader-driven handling. The follower’s overall position is monitored through aggregate reserve and payment data rather than claim-by-claim review.

For brokers and clients, SCAP delivers efficient handling of routine claims. Clients with smaller claims do not face delays while followers sign off; the leader handles and settles.

Common variations

“Class-specific SCAP” — different thresholds for different claim types within a slip.

“Time-limited SCAP” — authority that expires after a defined period if not used.

“Conditional SCAP” — authority subject to defined conditions (e.g., requiring counsel’s opinion for matters above a smaller threshold).

“Joint SCAP” — multiple syndicates sharing SCAP authority.

“Reduced SCAP” — for higher-risk lines, lower thresholds to maintain follower oversight.

Example

A property slip has £25m of cover with 18 following syndicates. The leader is Syndicate A with 22% line; SCAP threshold is £400,000.

A property claim is notified at £180,000. Within SCAP. Handler at Syndicate A processes the claim — coverage analysis, adjuster instruction, reserve setting, settlement. Final settlement at £165,000 paid through bureau within 8 weeks of FNOL. No formal follower agreement required; followers see the work through ECF.

A second property claim is notified at £900,000. Above SCAP. Handler at Syndicate A processes the substantive work; coverage opinion obtained; counsel instructed. Before settlement, the leader seeks agreement from the claims market (Syndicate B, second-largest line at 16%).

Syndicate B reviews the file in ECF and accepts the leader’s recommendation. The settlement at £820,000 is approved; bureau processes the settlement within 14 days.

The followers (other 16 syndicates) are aware of both claims through ECF. None objects. The leader’s handling discipline maintains follower confidence; the leader’s renewal position is supported by the smooth claims handling.

See also

• Lloyd’s Claim Scheme
• Leader claims handling authority
• ECF (Electronic Claim Files)
• Bureau claim
• Lineslip claims

References

1. Lloyd’s Claim Scheme (current version).
2. Lloyd’s Claims Minimum Standards.
3. Lloyd’s Claims Management Principles.

Last reviewed

By Matt Bartlett, Director, on 2026-06-11. Next review: 2026-12-11.

This entry is part of the Apex Insurance Wiki. Last reviewed by Matt Bartlett on 2026-06-11. Apex Insurance Brokers Limited, FCA FRN 724952, Companies House 07014570. Not regulated advice — consult your broker on your specific position.