Lloyd’s is looking to reinvent the underwriting room to suit a more flexible working environment, with the aim of presenting concepts to the market for feedback in the first quarter of next year, CEO John Neal said during Insurance Insider’s virtual (Re)Connect event.
The CEO said the Lloyd’s market had been remarkably resilient during the height of the pandemic and said the enforced lockdown period had led the Corporation to think “more quickly and deeply” about how it would operate in the future.
One aspect is the use of both the physical and virtual underwriting rooms, with market debate ongoing about the need for a physical space in which to trade.
“I think we can rip up the room,” Neal said during the session. “Nothing envisaged in 1980 should be operable in 2025.”
He said Lloyd’s was working with the Lloyd’s Market Association on coming up with concepts for what the underwriting room could look like to present to the market in Q1.
Looking ahead, the CEO said: “I don’t think [the underwriting room] is rigid boxes with a number on which you turn up to every day.”
Neal said he believed the whole market would work more flexibly, with potentially less resource based in London. The location of Lloyd’s could prove to be the most valuable aspect of the marketplace, perhaps as a convening place, he added.
Lloyd’s reopened the underwriting room on 1 September, with around 400 people out of a usual 6,000 coming in 1 Lime Street in the first week. Under new social distancing measures, the Lloyds building can operate at 45% capacity.
During lockdown, the market “coped remarkably well, better than we thought – though the rhythm of business isn’t quite what it could be,” Neal said. “There is some value in physical connections.”
Work is ongoing on the virtual underwriting room, with further updates expected on this and other aspects of Future at Lloyd’s in Blueprint Two in November.
In terms of trading, Neal said there ought to be four different means of placing business at Lloyd’s: open market via the complex risk platform, coverholder business, treaty business and commoditised business.
On treaty, Neal said: “Not as much is placed in London as it was 25 years ago and why can’t that be? We can do very exciting work around data-first [capabilities] there.”
Meanwhile, Lloyd’s can leverage its role as a surplus market and help support local players as a provider of more commoditised products, Neal continued.
“There is an awful lot of SME business which is unusual and requires a different toolkit,” he said. “If we can get the right methodology to connect system to system, broker to broker, there is a wealth of business that can come to Lloyd’s.”
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