Lloyd's of London needs to undertake a number of initiatives to remain progressive and profitable, the chief executive of Markel Corporation said.
Tony Markel, president and chief operating officer of the Glen Allen, Va.-based insurer that operates a Lloyd's syndicate, made his comments in a talk at the Insurance Institute of London.
Lloyd's, he said, has made notable accomplishments in the seven years since Markel purchased Terra Nova Holdings and its six syndicates which were reorganized under Markel Syndicate 3000.
"By any measurement, it has been one of the most, if not the most dynamic, important, positive, productive periods in the history of Lloyd's," he said in remarks earlier this month.
However, the market still has work to do in order to remain a growing concern and the center of the insurance world.
Among the points he made:
o Taxation inequality needs to be addressed with Lloyd's members doing business in Bermuda. While the "inequity does not signal a 'death knell' if nothing is done…it will clearly be an encumbrance to growth and profitability.
o Cost and further modernization need to be addressed. This includes eliminating the mounds of files people carry around with them. The Electronic Claims Files initiative, he said, is a clear indication of the market's focus to eliminate these difficulties.
o Education needs to be broadened with training and better preparation to meet the growing complexities in underwriting.
o Greater pricing stability needs to be achieved. More power needs to be given to the Franchise Performance Directorate (FPD) to monitor existing and new players in order to maintain pricing adequacy.
o The FPD also must assure that syndicates "do not get away from their core competencies, i.e., diversification for diversification's sake."
Finally, he said the Lloyd's brand can not be taken for granted. The market, he said, needs to take its capabilities out to local markets and not presume the clients will come to them.
"I am excited about the position Lloyd's is in today, but there is still a lot work that needs to be done to take advantage of what has been accomplished and to assure the success and future of this venerable old, wonderful institution," Mr. Markel said.
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