Hiscox chairman Robert Hiscox has warned Lloyd's that it must modernise or it will "wither away" in the face of competition from Bermuda.
He said the challenge for Lloyd's chairman Lord Levene and new chief executive Richard Ward was to simplify market processes and capital structure.
The comments came as the specialist insurance group announced pre-tax profits of £70.2m in 2005 despite net losses of £165m from last year's devastating US hurricane season.
Hiscox said Bermuda was winning the battle to attract "big business" to its shores, having now "outgrown" the London market in reinsurance.
He insisted that "most of the new money" was coming to Bermuda.
"Because of infrastructure problems, Bermuda simply cannot take the variety and diversified business that London can but, for simple big business, it has won," Hiscox told Insurance Times.
He said Bermuda now resembled "the Lloyd's of old in its entrepreneurial spirit, speed of reaction and swift and sensible regulation."
Hiscox' core global markets division reported a pre-tax profit of £20.7m against a GWP of £555.2m.
Meanwhile, Hiscox UK saw its pre-tax profits more than double in 2005 to £40.5m from £17.5m in 2004.
Gross written premiums fell slightly to £207m from £212. The combined ratio was 84.1%.