Lloyd’s Looks Ahead...Way Ahead to Outline Goals

NU Online News Service, May 14, 2:21 p.m. EDT

Lloyd’s is looking ahead to the year 2025 to reemphasize goals for growth in the specialty insurance and reinsurance marketplaces.

Lloyd’s last week unveiled its “Vision 2025” strategy in its famous underwriting room at an event attended by Prime Minister David Cameron.

John Nelson, chairman of Lloyd’s, says the corporation sees long-term growth opportunities in emerging markets through an expanding network of brokers.

Additionally, Lloyd’s will not be “all things to all people,” says Hank Watkins, chief executive officer of Lloyd’s North America.

“We want to grow where we can get a fair return,” says Watkins in an interview. Or, as stated in Vision 2025, Lloyd’s will be a “risk selector rather than a capital provider to a commoditized market.”

The goals aren’t as revolutionary as they are evolutionary, says Watkins.

“We’re not changing—just being proactive,” he says. Lloyd’s isn’t breaking new philosophical ground in the business of insurance. Rather, the Lloyd’s market seeks to establish its well-known brand as something more than a taker of “nutty risk,” such as the body parts of movie or athletic stars, which grab headlines, Watkins says.

“Access to Lloyd’s is not always understood by brokers,” and the market is too-often passed up because of a misperception of Lloyd’s being too complicated, says Watkins, who has been tapping the press, updating the Lloyd’s website and speaking at universities to spread the word about Lloyd’s.

The United States is Lloyd’s largest market. Nelson says that fact is likely to remain, and “as U.S. [gross domestic product] grows, so should our business.” Additionally, he says in an interview for Lloyds.com, “There’s an opportunity for Lloyd’s and for the U.S., in the high-growth economies.”

The extent to which Lloyd’s U.S. remains the largest market could “drop a few ticks” as premiums from emerging countries such as Brazil, China and India increase, Watkins says.

Lloyd’s will be a broker market in 2025. Nelson says he hopes “to see a situation where brokers are extending their networks, picking up new business across the world and placing it at Lloyd’s.” Efficient technology use will optimize each stage from underwriting to paying a claim, he says.