A specialist insurance market has unveiled plans to revamp its process of approving syndicate business plans in the aftermath of a market-turning event (MTE), an event which causes a significant and rapid upturn in pricing.
In a recent report, Lloyd's outlined the measures for enhancing and accelerating the process of approving syndicate business plans, together with the six guiding principles on how the insurance market plans to respond to an MTE.
The six principles are categorised into two areas: crisis management, to ensure the market responds to a crisis effectively, pays claims as quickly as possible, and remains solvent; and opportunities to solve the market.
Search and compare insurance product listings for Finance and Insurance from specialty market providers here
To enable syndicates to respond more effectively in the event of a major catastrophe and allow capital to flow into the market more efficiently, Lloyd's said it would make trimming the review and agreement process of business and capital plans a priority.
“We want to make it easier for syndicates to do business by focusing our oversight efforts on the important things. One important area where we can help is to make sure the Lloyd’s market is in a position to act swiftly and decisively to any future market-turning events. This is about stronger, smarter oversight,” said Jon Hancock, director of performance management at Lloyd’s.
“We don’t want to impose overly burdensome requirements on syndicates or insist on any unnecessary processes or paperwork. We want to make it as straightforward as possible to raise new capital. Doing so will ensure that Lloyd’s is even better prepared for once-in-a-generation market-turning events.”
Lloyd's identified the September 11 World Trade Center attacks as the last clear market-changing event, which resulted to rate increases of roughly 40% across all classes of business. More than half the new reinsurance capital raised globally in the immediate aftermath of 9/11 went to Bermuda.
Related stories:
Lloyd’s aims to help market cope with a crisis
Lloyd’s reveals potential cyber attack cost
.jpg)
