In January, Lloyd's set out its vision to be the "platform of choice" for large and specialist property and casualty risks. The franchise board set out market goals in a three-year strategic plan to make sure that, with increasing competition, its powerful global brand was protected and was still seen as an attractive place in which to invest and do business.
Seven months into the project, Insurance Times takes a look at what Lloyd's has achieved so far in five key areas and how that progress is being viewed by the market.
1.Performance framework
What Lloyd's says
What the market says
Ewen Gilmour, chief executive of Chaucer, says: "This is a steady progression of improving the market and the way that it operates. Things are moving in the right direction."
Jeremy Brazil, director of London underwriting, Markel International, says: "Lloyd's is doing a good job of improving standards in the marketplace and with the involvement of market players in future developments we will no doubt see further promising results. We welcome the introduction of the franchise standards as they can only help establish a well-respected market standard."
But a senior underwriter spoke with less optimism: "All of the risk management matrices that are being implemented in the market are taking away the point of Lloyd's and stopping the entrepreneurial spirit from prevailing. We have gone from one extreme to the other. Overall, I agree that we should increase standards, but sometimes you wonder whether the civil servants are taking over the government in this place."
2.Capital framework
What Lloyd's says
What the market says
A managing agent source says Lloyd's needs to do more to address the cost of doing business at Lloyd's. "One of the reasons why managing agents are forming insurance companies is due, in part, to the expense of processing business in the Lloyd's market. It is very prescriptive.
"The big fear is that it is danger of pushing out smaller premium business and becoming a surplus lines catastrophe market as it's just too expensive. They need to address this before we go too far down the road and people say, 'it's too late'."
Ewen Gilmour says some managing agents want Lloyd's to address the issue of being able to increase their capital resources easily in the next stage of the three-year-plan. "Those of us who own 100% of capital do have the flexibility to meet recommended pre-emption. But as all capital providers have to agree to this, those people who have spread capital want to have more flexibility to increase their capital resources easily and as of yet that has not come in."
3.Security and ratings
What Lloyd's says
What the market says
One senior source commented: "Lloyd's doesn't do a bad job when it comes to dealing with security and ratings. One of the great things about doing business in Lloyd's is the infrastructure and the licence to do business virtually anywhere in the world."
4.Market access
What Lloyd's says
What the market says
Jeremy Brazil said: "Lloyd's is increasingly easing the burden on individual syndicates looking to expand overseas. This has been particularly evident over the past year in regards to opportunities developed in China."
A senior syndicate figure suggests that those managing agents who wished to write business in "far flung places" should attract a greater levy charge to the central fund.
"When you go to new areas it is very expensive, it is unknown and it is unchartered territory. So, potentially, Lloyd's could say to those people who decide to go there that they should bear more of the cost than the rest of the market."
5.Efficient business process
What Lloyd's says
What the market says
Mark Butterworth, chief operating officer at Liberty Syndicates, says:
"One of the things that we are all keen to achieve is maintaining the Lloyd's platform. If you are actively looking to do business then cost control and sensible regulation from Lloyd's, as well as continuing to create efficiency and effectiveness, is very important."
