Specialist insurer Hiscox is expecting its Lloyd’s arm, Syndicate 33, to have a £1bn capacity in 2012, up £100m from 2011.

Hiscox says the increase is driven by an anticipated improvement in market conditions particularly in reinsurance lines.

The insurer added the increase is also driven by “a desire to have sufficient capacity available in the event of a widespread market turn.”

Hiscox will submit its final plan to Lloyd’s by year-end which may include changes to the Syndicate’s capacity if the US hurricane season has no material impact on the market.