Is it time for the center of gravity of the insurance business (and its £57.9bn gross premiums/£10.6 billion profit) to move west? The Lloyd's syndicates can stay in London, just move the money.
Miami is nice.
From The Telegraph, March 20:
The insurance giant’s status as one of Britain’s pre-eminent financial institutions is under threat
On the face of it, things couldn’t be rosier at Lloyd’s of London, the £50bn insurance behemoth that provides cover for everything from floods and wildfires to cyber attacks, terrorism and even top celebrities.
Annual profits are up by £1bn to a stonking £10.6bn, gross written premiums increased 4.2pc to £57.9bn last year and the market’s balance sheet is strong, with total capital and reserves jumping 5.7pc to £49.8bn.
In the mundane world of insurance, this apparently counts for “a firm foundation for the challenges and risks ahead”, Patrick Tiernan, the recently anointed chief executive, said.
Yet behind the somewhat cheery sound-bites, something is amiss. In its annual report published on Thursday morning, just hours after the Middle East was turned into a giant inferno, the crisis barely gets a mention.
Worse, Tiernan appears to be avoiding the mainstream media, having hand-picked a handful of newswires and specialist publications to speak to while shunning The Telegraph and its rivals. As the world burns, is its most important insurance market missing in action?
After all, this is the same business that has faced accusations of pricing ship owners out of the market by jacking up premiums at a time when cover has never been more critical.
These are serious, legitimate concerns that need to be properly addressed – is Lloyd’s open for business for shipping and marine insurance in the Middle East or not?
It’s fine for Sir Charles Roxburgh, the chairman, to enthuse in his preamble to the report about how his goal is “to fulfil our vision for Lloyd’s to be the world’s pre-eminent global marketplace for insurance risk”, but the test of that is during mega-crises like these.
Ditto, Tiernan’s breezy statement about Lloyd’s of London benefiting “from 337 years of lived experience”. “It has endured countless wars, multiple financial crises and at least four industrial revolutions,” he says.
But what is the position today regarding what some experts believe could prove to be a more serious economic crisis than the oil shock of 1973?
Lloyd’s of London’s annual report stretches to 172 pages, six of which are dedicated to climate-related financial disclosures, 11 to executive pay, while “purpose” gets a whole page of its own.
Yet the situation in the Middle East gets nothing more than a passing mention, and where it is dealt with it’s either in the context of “earthquakes” or “human consequences”. All of this is no doubt important but clients want to know what the commercial consequences are.
The publication of the report – just hours after Tehran’s targeting of the Ras Laffan liquefied natural gas plant effectively turned the conflict from a military one into an economic one – was nothing more than unfortunate timing on Lloyd’s part, of course.
Nevertheless, it makes the failure to address the war all the more glaring. There isn’t even a mention of the Strait of Hormuz, the key waterway where the company at the heart of global maritime cover has faced criticism over cancelled policies and sharp price rises.
Lloyd’s of London will no doubt point to an interview that Roxburgh gave a week ago following an emergency meeting with the Chancellor where discussions were held about the part insurers could play in helping to reopen the Strait of Hormuz.
Yet his statement was too vague and non-committal to amount to much. “I reiterated Lloyd’s confidence in our marine insurance market, which has remained open and continues to support international trade and shipping during this period of heightened risk,” Roxburgh said....
....MUCH MORE
If interested see also at the Guardian:
Lloyd’s of London stresses it is still insuring shipping in strait of Hormuz
I think the answer is obvious, more cowbell coffee.
