LMA advocates for regulatory competitiveness in 2025

The Lloyd’s Market Association (LMA) is advocating for Lloyd’s to set a new standard in regulatory competitiveness by refining its compliance requirements for financial reporting. Paul Davenport, finance and risk director at the LMA, highlighted notable progress in 2024, including steps to reduce the volume and frequency of reporting for technical provisions and quarterly accounting returns. However, he emphasised that much work remains to fully achieve these objectives in 2025.

“This initiative is not finished,” Davenport said. “It will need continued, deep market engagement as well as relentless pressure on the pace of delivery.”

Streamlining data for better oversight

Davenport called for Lloyd’s to embrace a model of regulation that requires less data while fostering more meaningful engagement with firms, noting this approach could enhance regulatory efficiency and competitiveness.

“I believe there is an opportunity in 2025 for Lloyd’s to lead the way and demonstrate how a regulator can receive less data but at the same time get better information with more meaningful engagement with firms. In doing so, we can show how collaboratively designed regulation can unleash competitiveness while maintaining oversight discipline,” he said.

“To add further complexity, Lloyd’s is not just a regulator – it is also a performance manager, rating and central fund protector, tax and license compliance monitor, and process owner for capital to enter and exit fairly. That’s a lot of stakeholders to balance but those competing audiences often need the same information, so it is even more vital to be purposeful about every piece of data that is collected.”

Davenport outlined two key principles for the success of the initiative:

• Leveraging existing business data: He advocated for using data that companies already produce to manage their operations. This alignment would foster accountability and streamline reporting. For instance, Davenport pointed out inefficiencies in the current Syndicate Business Forecast (SBF) process, suggesting that aligning it with firms’ operational plans could benefit both Lloyd’s and capital providers.
• Aligning with industry standards: Reducing Lloyd’s-specific reporting requirements—referred to as “Lloyd’s-isms”—could make the market more accessible to talent and reduce costs. Standardising practices with the broader insurance industry would allow firms to recruit more effectively and deploy resources across various platforms.

A call for agility

While 2024 marked progress, Davenport stressed the need for a dynamic regulatory environment that evolves with industry best practices.

“This reporting rationalisation initiative needs to be finished at pace, but as a final thought, it needs to leave us with a data exchange environment for the market that does not then remain static for the next 20 years,” he said. “A regulator that remains competitive has to be agile and able to evolve so that the two design principles above continue to stay true – utilise what firms already produce and stay in line with global industry best practice.”

The LMA represents the interests of all 55 managing agencies and Lloyd’s members’ agents, which collectively oversee a market stamp capacity of £52.6 billion.

Do you have something to say about this story? Share your thoughts in the comments below.