In June, I headlined my column on Richard Ward–the new chief executive officer at Lloyds of London–The Mystery Man, because two months into his job, he had yet to lay out his vision or agenda. But the mystery is no more! In an exclusive, first-person account written for National Underwriter, Mr. Ward details his objectives for the world's oldest and most famous insurance market. Click here to read his article, and continue on to read my take on the emerging Lloyd's market.
Back in June, I gave Mr. Ward credit for laying low to learn the market and the job before going off half-cocked about his intentions. After all, he was an outsiderno insurance industry backgroundand before taking the lead, it made sense to make sure he knew what he was talking about.
However, as the summer passed without a Ward sighting, I began to wonder whether my next column about him would be headlined, The Invisible Man. I was assured by the powers at Lloyds that Mr. Ward was indeed making a lot of progress, but was not prepared to speak publicly–and certainly not with the media.
Mr. Ward at last made his long-awaited public debut on Oct. 5 in a speech before the U.K. Insurance and Financial Services Conference in Glasgow, but he still was declining any interviews with the press to elaborate on his plans.
That remains the case, unfortunately, but I am gratified he agreed to my request to pen a first-person piece for National Underwriter outlining how he would advance Lloyds revolutionary transformation.
I dont use the term revolutionary lightly. Lloyds has turned itself upside down and inside out, completely changing the way the market is financed and governed. The individual, unlimited liability Name investor has gone the way of the dinosaur, largely replaced by the more modern, limited-risk corporate capital player.
Meanwhile, a new Franchise Board limits opportunities for rogue underwriters to do their customersand the markets cherished reputationany damage.
In addition, Lloyds has made its operation far more transparent, accessible and press friendly.
They also brought in their first outside chairman, Lord Peter Levene, to provide a fresh perspective and keep shaking things up.
Now they have recruited another outsider–Mr. Ward–who makes clear in his piece that he intends to build on Lloyds reform efforts to improve efficiency and customer serviceincluding faster turnaround time on policy documents and claims payments.
As the former head of an electronic energy futures market, Mr. Ward is the perfect choice to find ways to cut the major cost-driver and time-waster at Lloydsthe mounds of paperwork clogging its arteries. Indeed, he laments that his market still generates four tons of paper every day–enough to fill two jumbo jets a year.
The one question I would like to pose to Mr. Ward when he does finally grant interviews is whether he intends to create a virtual market at Lloyds. While he doesnt answer that question directly this week, he makes it clear the sit-down, coffee house tradition of placing risks face-to-face will not disappear anytime soon.
I can see that Lloyds will have a physical trading floor for the foreseeable future, he writes, but it has to be supported by efficient business processes.
I still believe a virtual Lloyds market is just a matter of timebound to emerge sooner rather than later. Its a logical development, given Mr. Wards background in electronic trading, and the fact that the Lloyds syndication system lends itself to a new life on the Web–which would expand access, speed up processing and cut costs.
It wont be long, I predict, before I can officially dub Mr. Ward, The Electronic Man.
What is your view of the changes at Lloyds?
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