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John McCormack's reflections on 40 years in the market

26 Sep 2023

This year I celebrate 40 years since I started working in the London market as a Junior Marine Hull Underwriter with Sphere Drake Insurance Company.

At the time the current Lloyd's building was a construction site; everyone wore a suit and tie, attended the office 5 days a week, and, in the absence of Pret, lunch tended to be of the liquid variety. I remember my first job was to painstakingly record by hand every transaction on every ship written by my bosses onto underwriters' cards, adding to the hard copy records that had been collated many years prior with no computers in sight.

Most of my colleagues will remind me that they were not even born 40 years ago, so they will probably be unaware that two of the costliest storms on record at the time happened in 1983 - the largest being Hurricane Alicia in Texas, turning a profitable underwriting year into a challenging one.

I have witnessed many changes in the market, such as Lloyd's moving to a new building, the first appearance of computer screens, the introduction of corporate capital, syndicate consolidation meaning no longer needing 30+ syndicates to complete a slip as well as the introduction of modelling, actuarial and compliance teams. Mobile phones were a long way off back then, and the way to contact a colleague was to use the Lloyd's caller to announce their name or a post-lunch walk around one of the City pubs that the particular colleague was known to visit.

Today, we continue to experience many changes in the market. However, much remains the same, such as the sense of community, the fantastic career opportunities available, the chance to travel and meet overseas clients and the market friendships made for life, which, in my case, included finding my wife.

One of our strongest selling points to our clients and which draws them to London is our ability as a broker to meet face-to-face with an underwriter and negotiate bespoke terms on their behalf. I do hope that as a market we all work hard to preserve this as it really is a USP, and without it, we may find things very different when the market softens again.

Relationships, as well as reputations, develop over time at Lloyd's, but having both is still an essential requirement and spending time negotiating face-to-face certainly helps in the building of them, and many of my contemporaries who were around when I first started in the market are still in Lloyd's today, many in senior positions. Hopefully, the many good traditions of the Lloyd's market can be retained whilst at the same time, we all benefit from the efficiencies and speed that digitisation and Blueprint 2 will hopefully bring. Still, it is down to both brokers and underwriters to work at preserving the value of the underwriting room which can include Mondays.

40 years later, catastrophes continue to be one of the main drivers affecting the market's fortune, and with all the tools at our disposal, there is still uncertainty about how each wind season will affect everyone’s performance, so let’s hope the remainder of this year is fairly benign

I am delighted that I lasted much longer than Sphere Drake, and I hope to have many more years in the industry yet and as I still thoroughly enjoy it. However, I must admit that I still look forward to either a sabbatical or 'gap year', having left school on a Friday and started in insurance the following Monday all those years ago!