Wednesday, 27 February 2008

Comments on the Lloyd's Annual Underwriting Survey

What does thr Lloyd’s Annual Underwriting Survey tell us?

1) Lloyd’s is committed to providing more information about its performance than its competitors do. Survey respondents cited such transparency as a major competitive advantage and I believe it's part of why Lloyd’s brand is one of the business world’s most powerful.

2) Subprime is a concern to all, not just the D&O guys. The majority of respondents write property, marine, energy, and reinsurance yet “Managing the Cycle” is the most important issue, and “Global Financial Market Instability” the most significant factor, facing the global insurance industry in 2008.

3) Head East – the greatest area of growth according to Lloyd's underwriters is in China and India. I think this should say “untapped area of growth” because I believe Lloyd’s could write a lot more North American risk than it does. The combination of relaxed rules about how brokers can bring risk to Lloyd’s and the ease-of-access through adoption of ACORD standards will make it far easier for brokers to include quotes from Lloyd’s in marketing run-of-the-mill U.S. risk.

4) On the subject of Lloyd’s Market Reform, there is great progress in going to paperless accounting and claims. The report cites 82% agreeing that there is “high commitment” to reform but I’d like to see Lloyd’s boost its market reform marketing efforts by conducting a study about the impact of adopting ACORD standards. For instance, is manual upoad/download sustainable as compared to integrating ACORD standards into the process? We at Web Connectivity have volunteered to conduct this survey.
5) There is one underwriter who should be removed from the premises – see the chart below:

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