(Bloomberg) ? Lloyd?s of London, the world?s biggest insurance market, said ship insurer Dex Serv Ltd., will leave rather than abide by its underwriting regulations.

Lloyd?s had been in discussions with Dex?s syndicate 2241 to resolve concerns about whether the London-based company?s business plan for 2004 would comply with the market?s guidelines, Lloyd?s said in an e-mailed statement.

?Rather than make the suitable changes, they intend to move their business outside of Lloyd?s,? the statement said.

Lloyd?s in September 2002 won backing to set up a franchise board to oversee regulations and market standards to curb company losses and syndicate failures. Lloyd?s last month ordered Goshawk Insurance Holdings Plc, an insurer of property, aircraft and ships, to stop writing new business after losses eroded the company?s funds.

Dex will cease writing new business at Lloyd?s from December 31, the company said in an e-mailed statement.

Complying with the market would ?limit Dex to write smaller lines,? chief executive officer Mark Carter said in the statement.

Dex, a joint venture between Swiss Reinsurance Co. and UK insurer Thomas Miller & Co. Ltd. had capacity to underwrite $40 million of business this year. From January 2004 Dex will receive financial backing from Groupama Transport, a unit of Groupama SA, France?s biggest customer-owned insurer, Carter said.

Lloyd?s, founded more than 300 years ago, had the capacity to accept ?14.4 billion ($24.5 billion) of premiums in 2003.

The market, which has 71 member syndicates, posted its first profit in six years in April after insurers raised premiums to try to recoup losses from the September 11 terrorist attack.