Lloyds Chairman Peter Levene also offered pricing criticism directed at the insurance market amid threats from major Atlantic hurricanes like Gustav, taking a dig at Florida Gov. Charlie Crist for asking for lower-than-justified premiums for residents in his state.
Lloyds, a society of corporate underwriters and wealthy individuals that make insurance transactions through managing agents and syndicates, and the world’s largest insurance market, currently makes 40 percent of its premium income in the United States.
However, Levene said that the group must build on "markets of the future" to leave a strong business for successors.
"The balance of power in the world has truly shifted, and we have to rapidly wake up to that," Levene said in his annual speech to business leaders in London.
Levene noted that Lloyd's is already building up business in China and elsewhere in Asia, but has remained blocked in India "despite promises from the Indian Government to remove the protectionism which has lasted for far too long."
"We look forward to the day when we can play our part too in the development of the hugely successful Indian economy," he added.
In the Gulf, Levene said that the company was still deciding how to develop its business, citing enthusiastic support from a number of countries that left it "spoilt for choice."
In the United States, Levene said that Lloyd's must run its business in a way that allows it to pay out in the wake of hurricanes like Gustav, Hanna, Ike and Josephine.
"I am still amazed at the industry's collective madness in not maintaining prices at economic levels," he said, adding that Crist had approached him at the end of August asking for policyholders in Florida to benefit from premiums much lower than the market would justify.
"I tried without much success to explain to him that this didn't work with the economics which I had learnt," Levene said. "However when the market pays out over $14 billion to make good the devastation of Katrina, Rita and Wilma, the criticism seems to go into abeyance."
Levene also called on the British government to speed up a potential change to the way Lloyd's is taxed in Britain, a change that Levene argues is vital for the group to remain competitive against insurance markets in offshore centers with more amenable tax regimes. "We need a favorable decision now," he said.