What is the primary characteristic of the Lloyds Association?

The primary characteristic of the Lloyds Association is that it consists of syndicates that share in insurance contracts. Lloyd's of London operates as a marketplace where multiple syndicates, which are groups of investors and insurers, come together to underwrite and share risks associated with various insurance policies. Each syndicate is responsible for a portion of the risk, allowing for greater diversification and the ability to insure large or complex risks that may be too significant for a single insurer to handle alone. This collaboration among syndicates forms the unique structure of Lloyd's, enabling it to provide specialized insurance coverage that may not be readily available through traditional insurance markets.

The other choices, while they may describe certain aspects of insurance, do not accurately capture the essence of Lloyd's Association. It does not solely rely on state-run programs nor operates only under federal regulations, nor is it limited to drafting policies for high-risk individuals. Instead, its strength lies in the pooling of resources and risks through syndicates, leading to a broad range of insurance offerings.