LMA Market Strategy & Blueprint Two: Comment and Analysis -

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Some feedback comments on the latest strategy from the LMA;

Sheila Cameron, CEO of the Lloyd’s Market Association, has commented on today’s announcement from Lloyd’s as follows:

“The Lloyd’s Market Association (LMA) supports and welcomes the new Lloyd’s strategy launched today. Lloyd’s has indicated a clear and coherent direction of travel, one that focuses on the fundamentals of Lloyd’s and plays to its strengths of advancing and protecting the market. This strategy enables and serves Lloyd’s core stakeholders, the managing agents. We believe this new direction will help Lloyd’s managing agents to deliver better and more efficient outcomes for their own clients, the policyholders.”

“Maintaining market performance of sub 95% combined operating ratio through the cycle is the foundation on which all Lloyd’s Corporation strategies must be based. Additionally, the renewed focus on maximising the capital advantage for new and existing syndicates is the right thing to do and one which builds on the foundations created by London Bridge 2. Ensuring a tight correlation between oversight and risk will also be warmly received by managing agents.”

“We support the commitment to complete the back office re-platform in a phased and controlled manner, which will enable managing agents to meet their regulatory operational resilience requirements and ultimately increase their trading efficiency.”

“Finally, we particularly welcome Lloyd’s commitment to double its intake of early careers hires, with a view to feeding this talent into the market once they’ve completed their relevant training. The training will be shared by Lloyd’s and market participants through a market secondment programme. This initiative builds on the most recent report from the London Market Group (LMG), which outlined how only 7% of the London market will be under thirty years of age within the next ten years unless proactive steps are taken.”

“A number of these points have been made by the LMA to Lloyd’s over the last 12 months and we are grateful that Lloyd’s has agreed to push these initiatives forward. We look forward to working in partnership with Lloyd’s to deliver this strategy and to fundamentally make this market a better place.”

Caroline Wagstaff, CEO of the London Market Group, comments on the announcement of the new Lloyd’s strategy:

“The LMG welcomes the launch of the new Lloyd’s of London strategy announced today. It sets out a clear road map for what the market can become over the next decade with a strong sense of focus and direction.

Having raised the issue of declining demand of young talent in our London Matters report, I am particularly pleased to see the commitment by the Corporation to double their early careers intake. To continue to grow the London market, we must have talented teams in place and fully trained, and that takes time. I would echo Patrick Tiernan in saying this is not a nice to have but a competitive necessity.”

BLUEPRINT TWO PAUSE

Christopher Croft, LIIBA Chief Executive, reacts to the announcement that Blue Print Two is being paused indefinitely:

“Replacing the core systems at the heart of the market was always going to be a difficult task — the IT we rely on today is the product of decades of evolution, not a simple upgrade. Delivering a new, multi-lateral settlement engine and a modern carrier back-office that truly supports a subscription market is technically complex and operationally demanding.

“That said, the work remains essential. The continued delays make it understandable that Lloyd’s and the market bodies should take time to re-examine how best to achieve the outcomes we all need. If we are honest about the lessons of the last 25 years, we must ask whether very large, set-piece, cross-market programmes – competing with firms’ everyday priorities for scarce expert resource – are the most effective route. A fresh approach should consider smaller, modular builds, clearer commercial incentives and governance that drives delivery rather than perpetuates delay.

“This is now time to take stock and should be treated as an opportunity for radical thinking. The focus now needs to be on practical, market-led solutions that create genuine commercial pressure to finish the job – because the market cannot afford further drift.

“As George Foreman memorably put it: ‘Call me old, call me fat, but don’t forget to call me for dinner.’ We do not care about the moniker attached to this project – what matters to LIIBA and our members is that the vital work to replace obsolete core systems is delivered for the benefit of the market.”

Chris Jones, Chief Executive of the IUA, comments on today’s announcement from Lloyd’s to “sunset” Blueprint Two

“The original Blueprint Two programme was an extensive set of work that sought to fully digitise the London insurance market. That this has not yet been comprehensively achieved reflects the ambitious nature of the initiative. There have been some notable successes, however, including the establishment of core data standards, and these can be utilised going forward.

“The IUA will continue to work with its partners to improve market processes in the light of new technological advances, whilst ensuring that existing infrastructures are robust and supported. This will always be a collaborative effort, involving technology providers, carriers, brokers and Velonetic, which continues to provide critical services to our market. As a Velonetic shareholder, we are directly involved in developing effective governance for a new approach to digitisation that progresses on an incremental basis and minimises implementation risks.”

Ben Rose, Co-Founder and President of Supercede, the reinsurance intelligence company, commented:

“There won’t be a void if Blueprint Two disappears. The market has already voted with its feet. What participants want now are tools they can actually use today, not another decade-long transformation. The industry has shown it will embrace technology when it improves decision-making without forcing wholesale change.

“The real success story has been the Lloyd’s Lab. By opening the door to multiple technology providers, it has delivered better tools, more choice and faster progress. Market participants can adopt solutions that work for them, rather than waiting years for a single transformation to arrive.

“The lesson from Blueprint Two is that the industry doesn’t need another moonshot. It needs tools that make everyday decisions clearer and faster. Incremental improvement across the market will ultimately move the dial far more than one enormous programme ever could.”