Case Study - Lloyd's of London

Overview

A series of unavoidable setbacks, including asbestosis, environmental liability, and natural disaster claims resulted in Lloyd's of London suffering $12 billion in losses between 1988 and 1992.

To manage these losses and avert litigation by its members, Lloyd's developed a “reconstruction and renewal” plan. Designed to enable Lloyd's to restructure its losses and settle member lawsuits, the plan required approval by a majority of U.S. states.

Objective

The campaign set out to win the backing of Lloyds’ members in New Jersey, enlist their help in expanding support among fellow members, and to lobby the New Jersey Bureau of Securities to endorse the reconstruction plan.

Tactics

Members were contacted first by mail and later by phone. They were offered information on the personal benefits of accepting Lloyds’ offer and the importance of winning support for the plan from fellow participants. An invitation to attend a meeting at New York’s Waldorf-Astoria to learn more about the plan was also extended.

Results

A majority of New Jersey-based syndicate participants accepted the plan. At the New York meeting, several participants agreed to lobby both fellow members and the state in the plan‘s favor. Their help was crucial in ultimately winning formal support of the New Jersey Bureau of Securities for the Lloyds’ reconstruction and renewal plan.