'Returning to the Underwriting Room is not about reinstating the past'

25 October 2021 | 5-minute read 

Time spent in the Lloyd's Underwriting Room can now be optimised for targeted and complex negotiation with numerous markets.

During the past two years, the depths of the Lloyd’s market’s tenacity, adaptability, ingenuity and resilience have been shown as it met every challenge the pandemic has thrown at it. Throughout the bleakest points of lockdown, the Lloyd’s market kept calm and carried on, which is something all of us in the market can look back on and be very proud of.

Now, with Lloyd’s well and truly open for business in person, in recent weeks there have been noticeably more people returning to London and the Lloyd’s building, with brokers and underwriters frequenting the Underwriting Room in increasing numbers. Being able to meet multiple decision-makers in one place has been core to the Lloyd’s market’s success and remains equally important for its success in the future. While it is encouraging to see many grasping the opportunity to discuss complex transactions and trade once again in person, the market is yet to reach the numbers needed to achieve critical mass and allow participants to gain the full benefit it has to offer.

Face-to-face meetings

Some senior underwriters and line-of-business managers have stated their commitment to resuming collaborative negotiation face-to-face in the room. In a recent letter to brokers, the property direct and facultative committee, which constitutes 18 of the largest markets in Lloyd’s, also said its members will ensure underwriters are present in the room on Tuesday, Wednesday and Thursday mornings. Other markets have also made similar commitments to their broker partners.

While these efforts are commendable, broader uptake and commitment is needed. It is very difficult for any individual underwriter to be a first mover and, quite simply, without more underwriters, the value for brokers visiting the room remains diminished.

Reflecting on the past two years, most agree something is lost when transacting business without the face-to-face element. During that time, younger colleagues also missed out on the gradual assimilation of ideas and knowledge that happens naturally in the workplace and is vital for their career development. Covid-19 deprived us of these things but we are now in a position to reclaim them.

Going back to the room should not be confused with going backwards or seen as a desire by anyone to reinstate things exactly as they were. Going back to the room allows underwriters and brokers to regain the tremendous efficiencies it affords as, populated with sufficient numbers, there is no better place to get complex negotiations completed efficiently.

The underwriting community stands to gain much by enabling that to happen again and I strongly believe in the benefits of a thriving marketplace with multiple markets all available to brokers.

Rather than a step backwards, this is an opportunity to make a stride forward by taking the best of two effective working methods and melding them together. Both the room and electronic trading offer tremendous efficiencies in different ways and building a hybrid model that gets the best of both worlds will bring never-before-seen benefits.

This is not about underwriters waiting in the room all day for brokers to appear, or brokers queuing to get a simple endorsement agreed.

Optimising time

Time in the Underwriting Room can now be optimised and condensed into multiple, pre-booked appointments and used for tasks such as targeted complex negotiation with numerous markets. Such conversations are not only far better face-to-face but, with the relevant people sitting close by, it is much more efficient than organising five separate half-hour phone or online calls or going to five different offices in EC3.

An underwriter could, for example, use the room for such tasks in the morning, return to their office for in-depth client meetings via Teams or Zoom in the afternoon, with time in the office or at home spent reviewing submissions, pricing outputs and agreeing endorsements on PPL. While it may take some time for individual companies and underwriters to work out exactly what the ideal hybrid model looks like, the tremendous potential exists to build a new, optimal and more efficient way of working.

The collective effort by everyone to steer the market through the pandemic was a remarkable achievement. Making the most of that same adaptability and tenacity that ensured the market’s continued ability to serve its customer base can now enable us to not only move on but get ahead.

Successfully combining the unique efficiencies of face-to-face negotiation with those of electronic trading promises to usher in an era where Lloyd’s is more efficient and accessible than at any other point in its 333-year history. 

First published in Insurance Day: 18 October 2021

Patrick Davison
Underwriting Director

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