Lloyd’s syndicates seeing better COR after investing in digital transformation – WTW

London market firms gunning for long-term profitable growth are starting to see tangible results from investing in technological innovations, according to research by global broker Willis Towers Watson (WTW).

In a statement released today (15 June 2023), WTW highlighted that syndicates in the Lloyd’s market that invested in technological changes achieved an outperformance advantage of six points compared to those that had been slower to innovate.

Specific examples of technological advancements included leveraging data assets, decision support ecosystems and digital trading solutions.

WTW’s analysis was of 49 syndicates, which make up approximately 85% of the Lloyd’s market, during June 2023.

“In 2022, the market was still at a tipping point with a focus on how to deliver operational efficiencies,” said Richard Clarkson, global market leader for Global Specialty, Insurance Consulting and Technology at WTW.

“Since then, this analysis shows sufficient momentum has been built to be able to say that the market has now tipped.”

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The research also classified syndicates into three separate groups.

At the top of the performance ranks, some 30% of respondents delivered an aggregated combined operating ratio (COR) of 89% in 2022 – forming what WTW described as the ‘racing ahead’ group.

Meanwhile, the ‘mobilising’ group – making up another 30% of the subset – delivered an aggregated COR of 93% last year.

And the ‘getting ready’ group, which made up the remaining 40%, delivered an aggregated COR of 95% during the same period.

Clarkson added: “Insurance firms across the board are successfully getting to grips with data, achieving better insights into drivers of risk performance and embracing new ways to trade and operate.”