Neal faces wide range of problems at Lloyd’s
Lloyd’s is in danger of falling behind the rest of the re/insurance industry if its new chief executive officer John Neal does not get a firm grip relatively quickly, according to Gavin Coull, partner and head of reinsurance at legal firm BLM.
“The Lloyd’s market has to change,” Coull said.
“It needs to stop being distracted by the buzzword of insurtech, which could be a fig leaf to cover a lack of transformation. There are possibly too many new entrants coming in, and Lloyd’s is now also being challenged by insurance-linked securities in London.
“Are they cutting the loss-making syndicates too late, or is the damage too deep already?”
Coull said that lines of business in many cases should have been looked at earlier and pointed to expenses as being a particular problem for Lloyd’s, and a huge operational problem for the market.
He said that his personal bugbear was claims, adding that brokers were ruling the roost, and that Lloyd’s needed to get back to technical claims management. He said that especially during soft markets how brokers handled claims could sometimes lead reinsurers to being put at a disadvantage.
Coull explained that during a soft market Lloyd’s often tries to find new areas to cover, the problem being that the syndicates might not understand those new lines in sufficient detail, citing cyber as an example.
“If you don’t understand what you’re writing then there might be a short-term gain but not over the long term,” he said. “Underwriters need to stick to what they do best and to do it well.”
Coull also claimed that Lloyd’s has been far too sanguine when it came to the UK’s departure from the EU, especially over EU-US cover arrangements and passporting, among other tangible issues.
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