By Carolyn Cohn
LONDON (Reuters) - Traditional insurance market Lloyd's of London plans to launch two automated exchanges to make doing business cheaper and quicker, it said on Wednesday.
Lloyd's, which has 99 syndicate members comprising British and international insurers with most of its business carried out face to face, is suffering from two years of steep losses and increased competition from centres such as Bermuda.
The Lloyd's Risk Exchange will automate simple insurance business and a second platform will be used for complex risks, Lloyd's said in a strategy document entitled "The Future at Lloyd's".
“We will succeed by harnessing the entrepreneurial and innovative spirit that is at the heart of Lloyd’s," said John Neal, who became chief executive in October last year.
Lloyd's, which started life in Edward Lloyd's coffee house in 1688 and is known for insuring everything from ships to paintings, has been trying to modernise.
It has moved some of its business onto an electronic platform, but progress has been slow.
"The new Lloyd’s will be nimbler and faster," Chairman Bruce Carnegie-Brown said in the preface to the strategy document.
Lloyd's aims to cut the costs of insuring standard risks to 10-20 percent of premiums from 30-40 percent, it said in the document.
The market will make it easier for new syndicates to set up business and will also encourage different types of funding, such as private equity and hedge funds, it added.
The strategy is the result of meetings with 1,000 market participants.
One market source described it as the biggest shake-up at Lloyd's since the early 1990s, when the market was almost brought to its knees by asbestos-related claims that wiped out many of its individual investors.
Further consultation on the strategy is scheduled for May and June, Lloyd's said, with the aim of implementing proposals from early 2020.