’If we do not drive down costs and adopt technology, we will simply fall further behind,’ says chief executive
London market carriers need to address their operational expenses following strong profits in 2023, Paul Brand, chief executive at Convex, has said.
According to Oxbow Partner’s CEO Agenda 2025 report, published on 24 October 2024, the market achieved a gross written premium (GWP) of £52bn last year, while the combined ratio dropped to 84%.
And over 70% of syndicates, accounting for more than 80% of Lloyd’s GWP, were profitable and growing.
Speaking at the AM Best European seminar in London yesterday (7 November 2024), Brand said: “If you look at Lloyd’s record results in 2023, on the surface all seems rosy.
“However, when you look at the underlying figures, there are questions that need to be asked. If you factor in the rate increases during recent years, the market share for the market is at best flattish.
“We have to ask ourselves, have we wasted some of the opportunities the hard market has given us?”
Technology efficiencies
He added that underwriters needed to take advantage of the efficiencies that technology can bring and reduce expenses, as years of hardening premiums could only go so far.
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He said: “When it comes to operational expenses, there is a view that we need to look at the costs of distribution and they should charge less.
”However, that is displacement theory. Brokers will do their best for their clients. It is up to carriers to look at operational expenses and technology could be used to create better outcomes.
“There has always been the view as to where do you find the time to implement technology.
“However, the alternative is that you become obsolete. If we do not drive down costs and adopt technology, we will simply fall further behind.”
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