LONDON, Feb 26 (Reuters) - Lloyd's of London will
pilot an electronic exchange to handle simple insurance risks
this year, it said in a strategy update on Wednesday, as the
330-year old commercial insurance market seeks to modernise.
Lloyd's, which started life in Edward Lloyd's coffee house
in 1686, is trying to become more efficient and cut costs as it
competes with rival insurance centres such as Bermuda and
Singapore.
It said last year it planned to launch two exchanges, one
for simple and one for more complex insurance risks.
It said on Wednesday it had taken a 40% stake in an existing
electronic placement system, PPL, which will form the basis of
the complex risk exchange.
Lloyd's said it had completed the transition phase of the
strategy change and was moving into the first phase of delivery.
"We are now ready to start building the Future at Lloyd’s,
having achieved three major objectives - securing finance,
setting the governance structure and detailing the plan for the
next 12 months and beyond," Chief Executive John Neal said in a
statement.
The Lloyd's market is made up of 99 syndicate members and
insures anything from ships to sculptures. Much of its business
is carried out face-to-face in its City of London tower, with
brokers and underwrites carrying papers around the building in
briefcases or even suitcases.
Several insurance sources told Reuters they approved of the
modernisation plans, though one said the exchange was trying to
do too much too soon. Some smaller insurers and brokers are wary
of being cut out of the new-look market.
(Reporting by Carolyn Cohn. Editing by Jane Merriman)