On 6 December 2010, Lloyd’s published its strategy for 2011 with a strong emphasis on intensifying its regulatory function.

The strategy outlines the challenges that Lloyd’s faces in the current climate and identifies responses both from the perspective of managing agents and the Corporation.  Richard Ward, Lloyd’s Chief Executive Officer, notes that the new strategy represents a change of emphasis, rather than direction.

In order to increase the attractiveness of Lloyd’s to brokers and capital providers, a performance management framework has been put in place with the aim of raising standards across the market.  To this end, the Franchise Board at Lloyd’s has been tasked with maintaining underwriting and claims discipline.  This does not mean that managing agents will be absolved of responsibility, as the onus will remain on them to maintain their own underwriting discipline.  However, the Corporation does envisage that its responsibility for market oversight will become increasingly visible and robust.  This will translate into increased interventions which may well be more formal and at a higher level.

Ultimately, Lloyd’s aim in constructing its market oversight regime is for disciplined underwriting to be fully supported, leading to higher levels of capital being preserved and ensuring that those in the market are able to capitalise on opportunities when market conditions become more favourable.

Further information, and a link to the new strategy document, can be found here.