What type of liability do individual members (Names) have in Lloyd's?

In the context of Lloyd's of London, individual members, often referred to as "Names," typically have unlimited liability. This means that these members are fully responsible for the debts and obligations of the syndicate they are a part of, which can extend beyond their initial investment in the syndicate. If the syndicate incurs losses that exceed its capital, the Names can be liable for the excess amounts, potentially impacting their personal assets.

This structure was originally established to attract wealthy individuals as investors and to create a robust market for underwriting insurance, where backers are willing to take on significant risk. Consequently, the system incentivizes careful underwriting and management of risk, but it also places a heavy burden on individual investors should the risks not be managed successfully. Understanding this concept is crucial for recognizing the financial responsibilities involved in participating in Lloyd's as a Name.