Lloyd's chief 'to criticise insurers'

Insurers expect hurricane Isabel to cost $3bn in claims

The head of Lloyd's of London, the world's oldest and largest insurance market, is about to reveal that the UK insurance market has the highest operating costs in the world, a report says.

Nick Prettejohn, Lloyd's chief executive, will give the damning assessment of UK insurance firms at a speech at the Chartered Insurance Institute's annual conference, The Times newspaper said.

In his speech, Mr Prettejohn will reportedly blame complacency and the irresponsible behaviour of insurers for the unnecessarily high costs facing the Lloyd's group.

The Times said that Mr Prettejohn will hit out at inefficient systems and sluggish business practice and call for greater use of technology rather than the archaic reliance on paper-processing.

Lloyd's is made up of a collection of 71 syndicates, or smaller insurance companies. It does not offer retail products or insurance in itself, but brings together insurers and companies with a specific risk they want to cover.

Hurricane fears

The 315-year old insurer is used by the majority of the UK's blue-chip companies and has suffered six years of losses.

Its insurers have recently paid out for the September 11 attacks, as well as a raft of claims in the 1990s for asbestos and other disasters such as Exxon Valdez and Hurricane Andrews.

Lloyd's insurers are now bracing themselves for losses from Hurricane Isabel which is expected to hit the eastern coast of the USA later on Thursday.

The hurricane is expected to cost the insurance industry $3bn (£1.9bn) in claims.