I am becoming increasingly troubled by what is going on at Lloyd's. The more the darkest workings of the market are illuminated, the more I feel that it is an unwieldy beast, mired in its own history and politics and incapable of change.
I find myself constantly harking back to a comment made by a banker-turned-broker friend of mine: if Lloyd's were to be created today, it wouldn't be built in the same way.
The efforts to create more efficient processing are a case in point. Look at Kinnect, formerly Project Blue Mountain. The project is consuming millions of pounds of franchisors' funds - £40m so far- with no sign of when the market will actually be able to use it. I, and many others, are left wondering when hole will finally be filled and at what cost.
At the end of the day will there be a viable solution, or will the market be left footing the bill for a white elephant? Certainly there are senior market figures who are less than convinced.
A further example of Lloyd's troubles is demonstrated by the marine hull market, a market that is slowly but inexorably dragging itself down through the seemingly irrational underwriting decisions of the syndicates.
When the market is barely breaking even and significant rates increases are required why are underwriters still offering terms at less than the technical rate?
The reason is that they are engaging in a short-sighted scramble for business. It would be risible if it were not so serious.
Of course the franchise board is taking a close look at their activities, but I am left wondering what sort of clout it could really wield.
There are managing agents, backed by multinational enterprises, who would quite happily walk away from Lloyd's if it suited them. Given that, will Lloyd's efforts to control its members be truly successful?
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