By STEVE TUCKEY,
who has written on insurance issues for a decade for several national media outlets
Lord Peter Levene, chairman of Lloyd's, does not appear too concerned with the prospect of an insurance exchange set up by New York regulators that could loom as competition for the one set up nearly 400 years in a London coffee shop.
Levene told Risk & Insurance® during a meeting on Thursday, "I really don't exactly know how it is going to work," adding that he has been seeking more information from others closer to the project.
The exchange would be a Lloyd's style marketplace in which buyers could purchase insurance and reinsurance and capital providers could form syndicates.
In 2008, Eric Dinallo, then New York insurance superintendent, proposed reviving the New York Insurance Exchange that operated in the early 1980s but was sidetracked by the events surrounding the meltdown of American International Group. He resigned last year and was succeeded by James Wrynn last fall.
If Levene is not sure how the operation would work, neither are its advocates in the New York department who seem open to either a brick-and-mortar style of operation or one that is merely an electronic platform. But Gov. David Patterson has made it a priority.
Levene was in New York to accept the Insurance Leader of the Year award, given by St. John's University's School of Risk Management on Wednesday, Jan. 20.
An outsider to the insurance industry when he was named chairman in 2002, at a time when there was some question whether or not Lloyd's would survive, Levene seems genuinely pleased to be part of the "club."
Former AIG chairman Maurice Greenberg presented him with the award and served as the event's co-chair. The honoree was not shy about sharing his views of what he considered the shabby treatment afforded Greenberg, starting with his ouster from the insurance giant in 2005.
"Throughout that very sorry saga, Hank has maintained enormous dignity and now has been totally vindicated," Levene said.
In addition to paying tribute to Greenberg, Levene also thanked less controversial figures such as Willis Chairman Joseph Plumeri and Insurance Information Institute (III) President Robert Hartwig, "who welcomed me into the insurance world."
STUCK IN HIS CRAW
With the United States as Lloyd's top market, Levene keeps a keen eye on regulatory developments here. Collateral requirements for alien reinsurers still stick in his craw as much as ever and discounts efforts in the States to develop the kind of mechanisms that would do away with them.
"All I will say is that they are creeping forward," he said.
Levene does not see any indications from the January renewals of a hard market developing.
"When you have a year like we had last year without any major hurricanes, you are just not going to get that kind of action," he said.
But he takes pride in that the mechanisms and safeguards developed under his leadership will ensure that "all eyes are on the bottom line and not the top line."
One way to get Levene to perk up is ask him what he feels his greatest accomplishment is.
"That is an easy question. When I first got here Lloyd's was Lehman Brothers, AIG and Royal Bank of Scotland all rolled up into one," he said. "My colleagues who were there at the time recalled that whenever they went to a dinner party, no one would mention that they worked at Lloyd's."
But all that has changed. Levene remembered attending an industry event last year at which he was told, "thank heavens for Lloyds. You are the rock, the one steadfast company that we know will be there for us."
Does Lloyd's resurrection give him any sympathy for all the players in the Great Meltdown of 2008, be they heroes or goats.
"Some I have a great deal of respect for," he said. "Others, not so much."
January 22, 2010
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