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Lloyd's of London

Insurance and reinsurance market in London

Lloyd's of London, established in 1689, operates as a marketplace for underwriters to pool and spread risk. It is governed by the Lloyd's Act 1871 and subsequent Acts of Parliament. The market primarily deals with general insurance and reinsurance, with a focus on marine insurance. Lloyd's has a strong financial foundation and a motto of 'confidence'. As of 2023, it consists of 78 syndicates managed by 51 agencies, writing premiums from around the world.

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Timeline

Earliest reference to Edward Lloyd's coffee house on Tower Street

In 1686, the earliest reference to Edward Lloyd's coffee house on Tower Street was made, which later became the famous meeting place for marine underwriters and the birthplace of Lloyd's of London.

Formation of Lloyd's of London

Lloyd's of London was established in 1688 as a coffee house where ship owners and merchants gathered to insure their ships and cargoes. It later evolved into a prominent insurance and reinsurance marketplace.

Founding of Lloyd's of London

Lloyd's of London was founded by Edward Lloyd at his coffee-house on Tower Street in approximately 1689. It started as a market primarily focused on marine insurance.

Formation of The Society of Lloyd's

In 1691, the small club of marine insurance underwriters relocated to No. 16 Lombard Street, marking the beginning of The Society of Lloyd's. This arrangement continued until 1773 when underwriter John Julius Angerstein acquired two rooms at the Royal Exchange in Cornhill.

Establishment of Lloyd's Corporate Archive Collection

The collection of Lloyd's Corporate Archive dates back to 1771, with some deeds even dating back to 1585. It is freely accessible to the public and provides valuable historical information.

Society of Lloyd's founded at the Royal Exchange

In 1774, the Society of Lloyd's was founded at the Royal Exchange, marking a significant milestone in the history of Lloyd's of London as a prominent insurance market.

Zong massacre trial

The Zong massacre trial took place in 1783, a controversial case involving the slave ship Zong where enslaved Africans were thrown overboard, highlighting the moral and legal issues of the transatlantic slave trade.

John Julius Augerstein Becomes Chairman

In 1795, John Julius Augerstein, later known as 'the Father of Lloyd's,' became the chairman of Lloyd's. He implemented significant organizational changes and efficiencies during his tenure.

Sinking of HMS Lutine

In 1799, the sinking of HMS Lutine occurred, a British warship that faced a tragic fate off the coast of the Netherlands, leading to the famous Lutine Bell being salvaged and housed at Lloyd's of London.

Abolition of Slave Trade Monopoly

Lloyd's obtained a monopoly on maritime insurance related to the slave trade and maintained it until the abolition of the slave trade in 1807. This marked the end of Lloyd's involvement in insuring slaves and slave ships.

Journalist Describes Underwriting Room at Lloyd's

In 1859, a journalist provided a description of the Underwriting Room at Lloyd's, showcasing the bustling activity and importance of the insurance market.

The Lloyd's Act was passed in 1871, introducing important regulatory changes and establishing the modern framework for the operation of Lloyd's of London as an insurance market.

Establishment of Lloyd's of London

Lloyd's of London was established in 1900 and has since become a prominent institution in the insurance industry, known for its unique structure and history.

San Francisco earthquake

The devastating San Francisco earthquake of 1906 had a significant impact on Lloyd's of London, leading to substantial insurance claims and reshaping the global insurance industry.

Lloyd's Act 1911

The Lloyd's Act 1911 outlined the society's objectives, emphasizing the promotion of its members' interests and the collection and dissemination of information. This act played a significant role in shaping the governance and operations of Lloyd's.

Sinking of the Titanic

In April 1912, Lloyd's suffered a significant loss with the sinking of the Titanic, which was insured for £1 million, representing a large portion of the market's capacity. The event is famously recorded in the 1912 'Loss Book' displayed at the Lloyd's building.

Modification of liability policies by Lloyd's and American underwriters

Lloyd's and American underwriters changed their liability policies in 1970 to exclude environmental claims unless they result from a sudden and accidental incident.

Chairmen of Lloyd's since 1979

List of individuals who have served as chairmen of Lloyd's since 1979.

Fisher Report on New Lloyd's Act

Sir Henry Fisher was commissioned to create a new Lloyd's Act in response to the 'democratic deficit' and lack of regulatory muscle at Lloyd's. The Act of 1982 redefined the business structure, giving external Names a role in the business through a new governing Council.

Merrett Syndicate Reinsurance Voided Due to Asbestos Exposure

In 1981, Pulbrook syndicates 90/334 had reinsurance on its general liability business with Merrett syndicate 418, but in 1990 an arbitration ruling voided the arrangement due to non-disclosure of asbestos exposure extent, leaving Pulbrook Names without cover for their losses.

Challenges in closing 1979 year of account

In February 1982, Auditors Neville Russell and other Lloyd's auditors highlighted the impossibility of closing the 1979 year of account for many syndicates due to unquantifiable asbestos and pollution liabilities, seeking guidance from the Lloyd's Council.

Resignation of Lloyd's Chairman Sir Peter Green

Peter Cameron-Webb and Peter Dixon of PCW Underwriting Agencies were involved in a $60 million fraud through rigged reinsurance transactions, leading to the resignation of Lloyd's chairman Sir Peter Green in 1983. This event marked a significant turning point in Lloyd's history.

Time Capsule Buried in Lloyd's Building

In 1984, a time capsule was buried within the roof of the new Lloyd’s building during a 'topping-out' ceremony led by HM Queen Elizabeth, The Queen Mother. This act symbolized a connection to Lloyd's traditions and history, set in a modern and innovative architectural marvel.

Auditors Keep Outhwaite's 1982 Year Open Due to Asbestos Concerns

In 1985, under Lloyd's three-year accounting rule, auditors kept Richard H. M. Outhwaite's 1982 year open, citing worries about asbestos and pollution liability losses that eventually amounted to hundreds of millions of dollars.

Lloyd's 'General Undertaking' agreement

In 1986, Lloyd's required all Names to sign a new 'General Undertaking' agreement, which included clauses such as 'forum selection' and 'choice of law'. This agreement mandated that all cases must be heard in U.K. courts applying U.K. law, conflicting with existing American Securities law.

Piper Alpha explosion and the LMX spiral

The Piper Alpha oil rig explosion on July 6, 1988, led to significant losses. The subsequent reinsurance practices, known as the London market excess of loss (LMX) spiral, caused claim values to escalate uncontrollably within the Lloyd's market.

Lloyd's of London LMX Spiral

In 1989, the Lloyd's of London insurance market faced a crisis known as the LMX Spiral, where multiple syndicates became exposed to the same claim multiple times through layers of reinsurance, leading to significant losses for some reinsurers.

Lloyd's of London reports £2.3 billion losses

In 1993, Lloyd's of London declared losses amounting to £2.3 billion for the 1990 year of account. The trend of members leaving Lloyd's continued during this period.

Lloyd's Fraud Exposure

In 1991, Lloyd's of London declared the effects of the fraud, revealing the extent of the financial wrongdoing within the insurance market.

Lloyd's declared

In 1992, Lloyd's made a significant declaration, which impacted its operations and the insurance industry.

Centrewrite Ltd assumes Warrilow's liabilities

In 1993, Centrewrite Ltd took over the 1985 and prior years' liabilities of Warrilow's syndicate 553. It also offered estate protection plans and reinsurance policies to Lloyd's Names.

Reconstruction and Renewal (R&R) Plan at Lloyd's of London

In 1995, under the leadership of Sir David Rowland and Peter Middleton, Lloyd's of London introduced the ambitious 'Reconstruction and Renewal' plan. The plan aimed to separate the ongoing Lloyd's from its past losses by transferring pre-1993 liabilities to a special vehicle named Equitas at a cost of around $21bn.

Lloyd's R&R offer deadline

Lloyd's set a deadline of 28 August 1996 for acceptance of their R&R offer, with threats to aggressively pursue Names for their alleged losses if they did not accept.

Lloyd's of London asbestos and pollution claims

In 1998, Lloyd's of London faced a significant financial crisis due to asbestos and pollution claims. Despite court victories by Names' Action Groups, only a fraction of the total claims were recovered.

Authorization under the Financial Services and Markets Act

In 2000, Lloyd's of London was authorized under the Financial Services and Markets Act, granting it legal permission to operate within the financial services industry.

Berkshire Hathaway subsidiary National Indemnity Company (NICO) assumes Equitas' assets and liabilities

In 2006, the Berkshire Hathaway subsidiary NICO agreed to take over all of Equitas' assets and liabilities, providing $7bn of new reinsurance cover for future claims payments.

Centrewrite Ltd assumes liabilities of other syndicates

In 2013, Centrewrite Ltd took on the 2001 liabilities of life syndicate 1171, as well as the 1997–1999 years of Crowe syndicate 1204 and the 1999–2001 years of Cotesworth syndicate 535. The liabilities of Crowe and Cotesworth were later novated to Riverstone in 2012.

Lloyd’s Apology for Historical Links to Transatlantic Slave Trade

In 2020, Lloyd’s apologized for its historical connections to the transatlantic slave trade and committed to acknowledging this part of its history. Research collaborations were undertaken to understand and contextualize these links, including a partnership with Black Beyond Data at Johns Hopkins University.

Death of Richard H. M. Outhwaite

After years of litigation related to asbestos exposure, Richard H. M. Outhwaite retired to Guernsey and passed away on November 20, 2021.

Financial Security of Lloyd's of London

As of December 31, 2022, Lloyd's of London has a strong financial position with a significant chain of security to ensure prompt payment of valid claims. This includes substantial assets at syndicate level and members' funds.

Lloyd’s Market 2022 Full Year Financial Results Announcement

Lloyd’s announced the market’s 2022 full year financial results on Thursday 23 March 2023. The announcement provided insights into the financial performance and strength ratings of the market.

End of the Timeline
Lloyd's of London

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