New Lloyd's of London CEO John Neal will need to plug gaps in the market's management team, tackle electronic trading and get to work on the market's high expense base when he takes over from Inga Beale on Oct. 15.
David Gittings hopes he will get to work on rebuilding the Lloyd's executive team, which has seen an outflow of talent of late. Gittings is CEO of Lloyd's underwriter trade body, the Lloyd's Market Association.
Both CFO John Parry and Chief Commercial Officer Vincent Vandendael, who was also slated to head up the new Lloyd's post-Brexit hub in Brussels, will leave in early 2019. Those departures follow the exit of Chief Risk Officer Sean McGovern, who had been at Lloyd's for 20 years, back in 2016.
In an email, Gittings said the new CEO must set the "long-term vision for Lloyd's with the market."
A senior market source, who asked not to be named, said that rather than a well-known insurance figure, Lloyd's needs someone who is adept at the operational side of the business. Lloyd's underwriters and brokers have generally been slow to adopt new technology; the market decided it had to force the issue in March by mandating the use of PPL, an electronic placement system.
Lloyd's has also struggled to keep its expense base in check. Its underwriters reported a collective expense ratio of 39.5% in 2017, which compared to 32.5% for a subset of the world's biggest insurers and reinsurers, according to reinsurance broker Willis Re.
"To my mind, expense management, digitalization, the PPL mandate — all of that for me is where Lloyd's now really needs to put its foot down," the source said.
The LMA's Gittings said Neal is "an interesting choice" as CEO. He also noted that Neal's experience complements that of Lloyd's Chairman Bruce Carnegie-Brown.
Neal has experience in Lloyd's and London market underwriting, having served as COO and chief underwriting officer of QBE's London-based European operations. He went on to become CEO of QBE Insurance Group Ltd. Carnegie-Brown is best known for his work in broking, having run the U.K. and European operations of Marsh, and chaired Aon's U.K. operations.