From Artemis, May 1:
Lloyd’s of London, the world’s oldest and most traditional marketplace for insurance and reinsurance underwriting, has promised six key changes in its new strategic direction, one of which is allowing flexible capital access to a diverse set of risks written in the market....MUCH MORE
Lloyd’s prospectus was released today, dubbed the “The Future at Lloyd’s.”
In all honesty, there isn’t really anything unexpected in the initial announcement and detail is lacking around all of the proposed initiatives.
But the six key ideas or themes the Lloyd’s market intends to follow-up on bode well for those investors and underwriters seeking to gain more simple and efficient access to the returns of underwriting there.
Lloyd’s calls the initiatives “transformational” saying that they could “shape the future of the world’s (re)insurance market.”
It’s worth pointing out though that they are really all borrowed from the broader trends already playing out across the insurance and reinsurance marketplace, hence have been implemented already by distinct re/insurance players, or companies servicing the space. They’ve also been previously announced in the prospectus teaser a few weeks ago.
A few have actually been raised before over the last two decades during other modernisation efforts at Lloyd’s.
In the past Lloyd’s failure to take on modernisation ideas that were presented to it has hampered its position, so it is encouraging to see this concerted effort emerge in 2019.
The question then is whether these six initiatives are enough to boost the profile and relevance of the Lloyd’s market and sustain that relevance into the future. The jury will remain out on that until we see these fully implemented.
Lloyd’s said there is a focus on “delivering higher quality risk protection for the market’s customers,” as well as providing ways to, “simplify access to the global insurance market,” while also reducing the cost of doing business at Lloyd’s itself.
Work is expected to begin on building and delivering prototypes of each of the initiatives from October 2019, with some expected to be operational in early 2020.
Interesting, John Neal, CEO of Lloyd’s, said today that where available technology already exists that can deliver quick-wins the market will look to embrace them, which is encouraging.
The six initiatives are:
- A platform for complex risk that makes doing business easier and enables efficient digital placement of the most difficult-to-cover risks.
- Lloyd’s Risk Exchange through which less complex risks can be placed in minutes at a fraction of today’s costs.
- Flexible capital that can simply and effectively access a diverse set of insurance risks on the Lloyd’s platform.
- A Syndicate-in-a-Box, which offers a streamlined opportunity for innovators to bring new products and business into the market....
