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Lime Street conundrum for Lloyd’s

January 20, 2022

The news that Lloyd’s is reviewing its future occupancy of the iconic Richard Rogers building in Lime Street is no surprise. Although it commissioned the building on the site of an older Lloyd’s building from the 1920s, it no longer owns it. It was first sold to Commerzbank for £231m in 2005 before Chinese insurer Ping An paid £260m for it in 2013. Lloyd’s is a tenant in its own building.

Crucially, the lease from Ping An comes up for renewal in 2031 with a break clause available in 2026. These dates are starting to come into focus and weigh on the minds of senior management at Lloyd’s. 

Digitisation of the way business is placed at Lloyd’s started to make serious progress at the end of the last decade after years of stuttering false starts. This came just in the nick of time as the Covid-19 pandemic closed the market building for months. All the sceptics who dismissed the prospects for digital placement were instantly proved wrong and the market adjusted to the sudden end of face-to-face discussions between brokers and underwriters in the Lime Street building.

Of course, some in-person business has returned spasmodically as the world emerges from the pandemic but everyone knows it will not be the same and that we will certainly not see a return to the queues of anxious brokers hoping to get the signature of a prized underwriter on their clients’ policies.

The drive to digitisation, better use of data and artificial intelligence continues unabated as Lloyd’s has confirmed over the last couple of weeks. 

The future could look like the past
There has already been much talk of how to make best use of the building. Back in the autumn of 2020 I wrote a piece for Insurance Post, imagining how the market might look in 2030:

“The sight of brokers scurrying around EC3 with bulging leather folders is now a distant memory and the complete pedestrianisation of the City, brought forward to 2023 by the Corporation, helped transformed the historic financial centre. Only the quite hum of the driverless electronic pods allowed along Upper and Lower Thames Street reminds us of the once traffic-choked roads.

“Gradually, the iconic Richard Rogers building in Lime Street found a new purpose. The old underwriting boxes became fewer and new, collaborative meeting spaces emerged in their place. Many say it has taken the market back to its roots in Edward Lloyd’s 17th century coffee house.”

This has already started to happen but is it really the solution for the Lime Street building? Clearly, with some imagination it can work for the underwriting floor and the open galleries but what about all that office space above them? This is what must be concerning Lloyd’s bosses.

The big question is what would become of it if Lloyd’s throws in the lease?

It is seen the world over as the Lloyd’s building, the only truly distinctive building associated with the insurance industry in the City of London. Although people may argue that a physical presence in the City is less important in this digital age, it still sends out a clear message about the importance of the insurance industry to the fortunes of the City and, in turn, the UK economy.

We need some imaginative solutions to ensure it retains an association with the insurance industry should Lloyd’s decide to vacate it. There is an Insurance Museum looking for a home but that alone would never be able to fill it or meet the rental expectations of its Chinese owners. Some serious collaboration across the market is required and Lloyd’s needs to initiate that.

Download my 2020 article from Insurance Post.

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