Sweet and clean
TO LLOYD'S most painful problems, Rowland has only half an answer, and I can outbid him. He offers those who are trapped in 'open years' — nightmarish lia- bilities from the past returning to haunt them — the chance to rule off their books. Lloyd's own central underwriting agency would take these liabilities on at a market price. I would reinsure them with my deep- pocketed ally, at much the same price — but to those who will settle on these terms I would add in a sweetener of my own. They would get an incentive payment, with a time-limit (settle now while stocks last) and a condition. Those who took my sweetener would bind themselves to stop litigating within Lloyd's, and instead submit all their disputes to arbitrators approved by the Bank of England. I might even help pay for the arbitrators. It would be worth my while, because what I want is a clean start. I am buying the goodwill of the world's best- known name in insurance, and I want to buy it untarnished. What must the name be worth? Lloyd's ought to put it in the bal- ance sheet. One question remains; is my timing right? I think so. Years of disaster have driven capacity out of the world's insurance market, and the survivors can make better terms, so that premium rates are hardening. Even at Lloyd's, a lot of expensive capacity and weak management has already been shaken out. The number of syndicates has come down by one-third in two years. One outward and visible sign of change I would enforce. Taking advan- tage of today's glut of property, I would
move Lloyd's into a building designed as an insurance market and not as a monstrous ego trip. I would dismantle the present building and, reading the instruction kit more carefully this time, reassemble it on the site of the Crystal Palace as a solar radi- ation panel or a cucumber frame.
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