Beale urges Lloyd’s not to turn its back on innovation
The more stringent business controls at Lloyd’s are to be applauded, but they should not come at the expense of innovation and entrepreneurship, says Canopius chief executive Inga Beale.
If innovation is stifled, she says, the Lloyd’s market share could shrink further, giving brokers less reason to place business there.
Beale said: “The Lloyd’s share of the overall global insurance market is decreasing. We rely on the brokers to bring the business into Lloyd’s. “If Lloyd’s continues to shrink that makes it very difficult for us as a player within Lloyd’s. “The challenge is to bring back the innovation and the entrepreneurship that made Lloyd’s successful in the first place.”
Beale said that the increasing controls imposed by the Lloyd’s franchise board are welcome, as Canopius wants to work in a well-controlled market. But she added that it is essential to get the right balance. “If we are stifled by too many controls, checks and balances, we are not able to show our innovative flair and be entrepreneurial.”
Beale stopped short of saying the current level of controls at Lloyd’s is excessive. She added: “We want to remain firmly as a Lloyd’s business.” Canopius is now a top-10 player in Lloyd’s, having completed its acquisition of fellow Lloyd’s (re)insurer Omega on 21 August. The company aims to pare back some of the business underwritten at Omega that does not fit its underwriting criteria, but the combined entity will command £1bn of premium. The deal will augment Canopius’s US binding authority and property treaty business, and will give the company a presence in theUSA it did not previously have through Omega’s MGA focused operation in Schaumberg, Illinois.
The business is about to be renamed Canopius US. The acquisition will also give Canopius a presence in US professional indemnity. Beale indicated that Canopius is still on the lookout for further purchases. She said: “There will be future activity so watch this space. We obviously have to digest the Omega acquisition and we’re hoping to get that done this year, so that we’re ready and everything is ready for the 2013 year of account.”
Beale added that the 10.7% stake Tower Group has taken in Canopius as part of the Omega transaction “may lead to further things in the future”. “We are about growing and looking for new ideas and we know how difficult organic growth is, so there is likely to be acquisition ahead,” Beale said.