Wendy Baker Departs As Lloyd's America President

Ms. Langley recalled that during Ms. Baker's tenure, she steered Lloyd's U.S. operations through difficult times, including the aftermath of the Sept. 11 terrorist attacks, as well as the 2005 season of record hurricane losses.

She added that Ms. Baker "helped ensure that America recognizes both the expertise and financial security of the Lloyd's market. I would like to thank her for her hard work and dedication. She leaves with our thanks and best wishes for the future."

Lloyd's chairman, Lord Peter Levene, called Ms. Baker "a true ambassador for Lloyd's in the U.S. over the last nine years. She will be sorely missed by both the U.K. and U.S. markets, and the corporation in London."

Ms. Baker managed six offices–New York, Chicago, Los Angeles, Kentucky, the Virgin Islands and Montreal, Canada. She also oversaw corporate marketing and communications, broker development, distribution, and compliance and regulatory issues in the Americas.

"Despite some tumultuous and tragic events, I have enjoyed representing such a unique market of dedicated underwriters and brokers," Ms. Baker said in a statement. "It has been a privilege as well to work with such dedicated colleagues within Lloyd's. I will miss them all. It has been fun."

Ms. Baker's statement did not mention any future occupational plans.

Ms. Baker began her career in the management trainee program at Continental Corp., eventually becoming president of Continental Reinsurance in 1990–the first woman to ever head a reinsurance company.

Last week, Lloyd's also released a new three-year plan–for 2008-2010–that underscores the use of underwriting discipline in a changing market.

Lloyd's Chief Executive Officer Richard Ward commented that the "market and corporation have achieved a number of key objectives, including upgrades from two ratings agencies, the development of a solid performance management framework and strong financial assets."

He added that the market remains in a "strong position to deal with any issues that it faces and capitalize on opportunities."

Mr. Ward said his priority as CEO remains "to work with the market to deliver our plan and increase the pace of change. There is clear evidence that the market, with the support of the corporation, is better prepared than ever to do this."

He warned, however, that the market is "fiercely competitive" and as conditions change, "significant challenges" lie ahead.

The three-year plan recognizes "the corporation must work with businesses in the market to help maintain underwriting discipline to ensure the market is well placed to shield itself from the worst effects of the down cycle and to take advantage of improving conditions when the cycle turns," Mr. Ward said.

According to Lloyd's Three-Year Plan, available on its Web site (www.Lloyds.com), the insurance industry is likely to experience falling rates and broadening terms and conditions. Therefore a "major priority is to work with managing agents to maintain prudent underwriting discipline."

Lloyd's said that "along with the emphasis on managing the cycle, work needs to continue on improving Lloyd's longer-term competitive position…so that the market will be able to take full advantage of market conditions when the cycle turns."

Lloyd's also said that a pilot project using syndicate transactional data is in the works as a price-monitoring tool. The goal is to widen its scope to incorporate the majority of syndicate data by the fourth quarter of 2008. Further benchmarking capability will be developed as part of a suite of business information tools to be rolled out to agents in 2009.

Another major development last week was the agreement by Japan-based insurance giant Tokio Marine & Nichido Fire Insurance Company Ltd. to acquire London-headquartered Kiln Ltd. for ?442.2 million ($893.8 million at current exchange rates).

According to the companies, the transaction will be implemented under Bermuda law, where Kiln is incorporated. A.M. Best greeted the announcement by putting Kiln ratings under review with positive implications.

Kiln's principal U.K. operating company–R J Kiln & Company Ltd.–is managing agent to four syndicates at Lloyd's and, in terms of capacity, is the fourth-largest agency trading in the market.

In addition to Bermuda and London, Kiln has operations in Hong Kong, Singapore, South Africa and Belgium.

Tokio Marine said it sees Kiln playing a pivotal role in the expansion of its international underwriting operations and in enhancing its existing overseas activities. The company said it intends to retain "the culture, identity and brand of Kiln."

Tokio Marine said it will work with Kiln management to develop a joint growth strategy and create a major underwriting platform for international commercial insurance and reinsurance in the United Kingdom, United States, Continental Europe and Asia.

The Kiln board said it will recommend approval of the acquisition at a special general meeting, and a shareholder circular setting out the details of the acquisition and the approval procedures will be sent to Kiln shareholders shortly. The acquisition is expected to become effective during the first quarter of 2008, Kiln said.

Tokio Marine President Shuzo Sumi said in a statement his company has had a close relationship with Kiln Group since its formation in 1962, and believes "we share the same fundamental values and business philosophy."

He called the agreement an "important milestone in our stated strategy to expand internationally, and we believe Kiln–with its underwriting expertise, skilled employees and strong brand–represents the perfect partner."

Kiln Group CEO Edward Creasy called the acquisition an "excellent outcome for Kiln, its shareholders and employees."

Kiln's aims will be helped by becoming part of a major international group, "which recognizes the strength of our brand, respects our existing culture, and which will provide exciting opportunities for Kiln's employees," said Mr. Creasy.