Lloyd’s CEO John Neal warns the market risks sliding into irrelevance if it does not embrace the digital age.

And it must offer more value to customers, who at best get back just $US60 ($87) for every $US100 ($145) they pay for doing business with Lloyd’s, he says.

“I can’t think of an industry outside of our own where that would be tolerated,” Mr Neal told a London conference last week. “We’re facing quite challenging headwinds.

“Our products simply aren’t keeping up with the changing landscape of risk and we’re not harnessing all of the new capital that’s knocking on the door.

“As a sector, our choice is to continue with business as usual and become irrelevant or change and realise an enormous opportunity in the world of risk.

“We need to reset the way in which insurance and reinsurance is transacted globally.

“We can do that by leveraging and seizing the spirit of innovation that’s always been at the centre of the market, and the trusted partnership and relationship between the customer, broker and insurer.”

The former QBE CEO, who took charge at Lloyd’s last October, has placed innovation at the heart of his modernisation plans – which was also a priority for his predecessor Inga Beale.

Last month the market began a global consultation on its Future at Lloyd’s document, which presents six ideas for responding to challenges.

One proposal that has attracted attention is the concept of a Lloyd’s Risk Exchange, to handle the placement of less complex risks more efficiently and cost-effectively.