The 300 year old Insurance marketplace, Lloyd’s of London, plans to halve the cost of buying insurance as part of a strategy to restore the fortunes of the company.
Chief Executive Officer John Neal said he planned to cut the cost of insuring risk from 39 percent of premiums to 30 percent within the next two years before lowering it again to 20 percent within five years. The cost of taking out insurance at Lloyd’s is almost unchanged from 1990, according to the company’s own statistics.
This bold strategy will keep the traditional insurance industry competitive in today’s digital age. With many new innovations, insurance is no exception to the change that is happening across all business industries. Overhauling the business model will be no easy task, but it is a necessary one, that will bring the practice of risk management and mitigation into the 21st century.
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