Lloyd’s of London will introduce a “suite of improvements” to deal better with misconduct.
Insurance market with more than fifty insurers and hundreds brokers has been linked to a culture of drinking and poor behavior after work.
Lloyd’s fined Atrium Underwriters PS1,000,000 for heavy drinking, initiations games and sexual remarks about female colleagues in early 2022.
In 2019, it was revealed that nearly one-third of the workers at Lloyd’s of London experienced sexual harassment during the year prior. This led to measures being taken to better deal with these allegations.
Market participants are aware that despite new levels of supervision of conduct, issues like bullying can still fall below the threshold to bar firms and individuals.
Lloyd’s Management is currently consulting on a framework to deal with behavior that will ensure better alignment with the firms’ internal HR and discipline processes. This will support firms’ abilities to investigate and address issues with their own employees.
The changes could include a new, not exhaustive list of unacceptable behavior, such as harassment, bullying, and discrimination.
A proposed rule change would prohibit “conducting Lloyd’s Business while under the Influence of Alcohol where it leads unprofessional behavior”.
The framework will clarify the conduct that Lloyd’s deems unacceptable, and will also specify when and how Lloyd’s may intervene. Lloyd’s encourages managing agents and syndicates, as a way to gain control over culture and performance, to investigate and solve issues on their own.
Lloyd’s could also improve its internal decision-making and enforcement processes so that decisions are made more quickly and consistently, while still maintaining the necessary procedural safeguards.
Lloyd’s proposes that its rules mirror those of the UK’s Financial Conduct Authority. This includes behavior that occurs outside of work, but in the presence other market participants.
Lloyd’s stated in the consultation that it would take action against any insurers that were judged to have underperformed due to poor culture. The consultation could result in action taken to “remove the firm’s ability to operate on the Lloyd’s Market”.
The Lloyd’s Market Association (which represents insurers) welcomed the proposals.
The deadline for responses to the consultation is 16 December 2024.
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