Lloyd’s of London—A three-centuries-long story of insurance industry transformation

Story by

Johnny Mccord

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Lloyd’s of London lays claim to a long and storied history: From its humble beginnings in Edward Lloyd’s coffee shop, where, 330 years ago, the British merchant fleet recognized it as the place to purchase marine insurance—it has secured its place as the world’s largest insurance market.

The influence of Lloyd’s is unquestioned.

The market helped enable Great Britain’s rise as a world shipping and economic power—and, as the world’s leading specialty insurer, it issued the first-ever auto, aviation, and space satellite policies. It also covered Betty Grable’s legs and Keith Richards’ hands.

Lloyd’s story is one of growth, challenge, and reinvention.

Addressing crises, Lloyd’s is—once again—the global leader

Reputation. Brand. They’re everything to Lloyd’s. Yet, the insurance market encountered tough times in the 80s, 90s, and early 2000s that, for a period, took away a little bit of its shine.

In 1988, when the Piper Alpha oil rig exploded, killing 167—extensive exposure was revealed. A $1B Lloyd’s claim triggered excess of loss policies. Claims’ values skyrocketed to $16B, nearly collapsing the market as reinsurers suffered spiral losses.

Then, in the midst of the spiral, the U.S. asbestos crisis of the 1990s hit—and massive claims against long-tail risk further damaged the market. 9/11 followed, delivering another blow.

This period revealed weaknesses. Lloyd’s, however, had been built on a strong foundation. The insurance market addressed the weaknesses forming its central fund, establishing new paths to stability and growth.

Today, Lloyd’s is the world’s largest insurance market—with a very active presence in the U.S.

Lloyd’s is meeting the challenges of the digital era head-on

For more than three centuries, Lloyd’s operated a traditional insurance exchange—all business had been manually processed and transacted on paper. While the market resisted tech adoption for a time, Lloyd’s recognized that it needed to evolve if it was to address the needs of our on-demand economy and the digital age. It also recognized that, through multiple human touchpoints, its cost of doing business was painfully high for an increasing segment.

The market needed to diversify and modernize.

Lloyd’s was also driven to reignite its once strong entrepreneurial spirit. Originally funded by private names, that spirit of innovation was overshadowed by the flow of corporate money. While financial backing is still important, Lloyd’s knows it needs to embrace a progressive, innovative mindset to remain relevant—and companies, like Loadsure, are part of Lloyd’s new and exciting future.

Lloyd’s Lab drives insurance industry innovation

Once guarded on technology, Lloyd’s is now actively searching for promising ideas and technologies—and accelerating innovation through its incubation lab, Lloyd’s Lab.

Given Lloyd’s prominence in the insurance industry, we knew early on that Lloyd’s Lab was something people would take very seriously—especially as the insurance industry was so long overdue for digital transformation.

They have—and with good reason.

Lloyd’s has encouraged companies, like us, to come to them with new ideas, new products, and new ways of insuring areas of risk that were once considered too complex or too inefficient to cover.

That’s where insurtech comes in—it’s all about driving effectiveness and efficiency.

And, with access to Lloyd’s mentors and data, we knew Lloyd’s Lab would deliver a powerful opportunity to drive innovative ideas and fledgling businesses forward.

We’re proud to say we’re part of the Lloyd’s Lab 4th cohort—an opportunity that has affirmed that we’re onto something special here, while also giving our business tremendous exposure that will help drive our future growth.

We’re excited to see what the future holds—and to play a role in accelerating the global insurance market into the 21st Century.