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Lloyd’s of London chairman concerned about rising trade barriers, independence referendum in Scotland


September 12, 2014   by Canadian Underwriter


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Cyber insurance, trade barriers and the Scottish independence referendum scheduled Sept. 18 were among the concerns recently cited by John Nelson, Chairman of Lloyd’s, during a dinner speech.

“One of the industry’s great challenges at the moment is to find ways to take on new and emerging risks such as cyber-crime, reputational damage, supply chain breakdown and climate change,” Nelson was quoted as saying in London, England during the recent 12th annual Lloyd’s City Dinner. “Insurance is a risky business. And at present, given the oversupply of capital, it requires particular skill and underwriting discipline.”

Lloyd's of London chairman John Nelson

A backlash against international trade also appears to be a concern.

“Cross border trade is being compromised by a rise in trade barriers,” according to a transcript of his speech on the Lloyd’s website. “The think tank Global Trade Alert has reported that between May 2012 and 2013, governments around the world imposed three times as many protectionist measures as compared to moves to open up their economies.”

Nelson chairs the Council of Lloyd’s, which manages and supervises the Lloyd’s market, which reported

direct written premiums of £26.489 billion in 2013.

Forty-three per cent of the Lloyd’s market business was from Canada and the United States in 2013, the Corporation of Lloyd’s reported earlier this year in its annual report for 2013. The total Lloyd’s market in Canada in 2012 was $1.7 billion, with 47% of direct premiums written in liability and another 34% in commercial property.

Trade flows “can bring millions of people out of poverty,” according to a transcript of his speech on the Lloyd’s website. “We have to be clearer about the benefits that this brings to all society. A recent poll in the U.S. showed that two thirds of Americans believe international trade is bad for the country – that’s somewhat unsettling.”

He also expressed concerns about the upcoming referendum on Scottish independence.

“Scotland makes a substantial contribution to the vibrancy and prosperity of the United Kingdom – not least in the financial Services Industry,” he said. “Likewise, the U.K is hugely important to the strength and economy of Scotland. I would be extremely sad to see Scotland leave the United Kingdom and I very much hope that the Scottish people vote to stay in the Union. It is in the interests of the entire Scottish population, and the wider British population, all 65 million of us, who inhabit these extraordinary islands that the Union stays together.”

As of Dec. 31, the Lloyd’s market had 91 active syndicates and 56 managing agents.

Lloyd’s chairman John Nelson. Photo courtesy of the Corporation of Lloyd’s


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