Lloyd's needs freedom, says Andy Cook
Results from the quoted Lloyd's companies are looking up, as you would expect. The results chart one of the hardest markets for years (see News Analysis, page 10).
Compared to this time last year, profits have improved dramatically. Some have seen their profits double and those who recorded losses have, in general, come into profit. Fantastic.
Strong performances at Lloyd's mean that investors will have no qualms about bringing their money to London rather than Bermuda. That's good news for Lloyd's and for brokers looking to place risks that the composites don't want anymore.
But who is best placed to take advantage of the market. Brit reckons it can raise £200m, in contrast to SVB, which is having a hard time convincing investors to raise cash for more underwriting.
At first glance this could appear to be an issue of size, favouring the larger groups. But look again. Hardy - a relative minnow - posted, arguably, the best performance of all the quoted Lloyd's companies.
What is happening is that a super league of Lloyd's vehicles is emerging - well-financed to take advantage of the market. But there are those who are struggling and could be vulnerable if they don't manage to raise cash soon .
And another differentiator is looming. Last week's Tiner Project revealed details of the FSA's hands-on plans to regulate Lloyd's.
Many have nothing to fear. Indeed, Hiscox chief executive Bronek Masojada positively welcomed the proposals.
The good, well-run companies will flourish, it is hoped. While those managed in a less secure way will have to improve or die.
One word of warning though. Lloyd's underwriters need the ability to break the rules. That's why Lloyd's can underwrite risks that no one else will touch. Let's hope the regulator will realise this.
