The Lloyd’s PR machine has a habit of making things sound impressive, but there was no doubting the new confidence in the market shown by Chairman Lord Levene describing it as “a beacon of certainty in an uncertain world”.

He told the Association of Insurers and Risk Managers in London that Lloyd’s, which had a horror run through much of the 1990s, is now secure. “If you want to sum up my mood and that of Lloyd’s, I would do so in three words – confidence, confidence, confidence,” he said.  

After announcing that the gloom has gone, Lord Levene said the foundations of the reforms introduced late last year are now firmly in place. He outlined three major reforms including the end of “byzantine” accounting practices, tougher guidelines on those business who trade in the Lloyd’s market and a move away from unlimited liability.

And as for the newly developed franchise concept, Lord Levene was optimistic that it should inject more financial stability into the market, bringing sustained profitability in the long term.

“Where once Lloyd’s could only take action after a syndicate had got into problems, now a Franchise Board will be able to take action before problems materialise and harm the financial performance of the market as a whole,” he said.

Lord Levene said Lloyd’s has had a cool, hard and critical look at its operations after 300 years of business. And he said a big lesson from the September 11 disaster was that strong, financially secure insurers are needed to foot colossal claims. “If there is inadequate cover, insurance companies will go to the wall, and then everyone suffers.”