On 25 November, the Lloyd’s market launched its first ever Innovation Awards. The awards were hosted by Lloyd's CEO Inga Beale and presented by Gavin Steele, secretary to the Council and the Franchise Board.

In her presentation, Beale said there was a genuine need for the market to innovate in order to thrive and grow and that a creative and entrepreneurial culture was necessary in order to do so.

In judging the awards, the panel was looking for true innovation, not just change, she said. In addition, the product or service needed to add to the relevance of Lloyd's in today's global market and have a positive impact on the policyholder.

The judging panel consisted of:

  • Steve Hearn, Chairman of the London Market Group
  • Tom Bolt, Director of Performance Management, Lloyd's
  • Professor Ralph Koijen, Professor of Finance, London Business School
  • Neil Maidment, LMA Chair; and
  • Shirine Khoury-Haq, Director of Operations at Lloyd’s

The winners, within each of the three award categories, were:

  • Best Product Innovation - Russell Kennedy, Class Underwriter, War and Terrorism at Brit Global Specialty, for devising a new cyber insurance product offering first party protection to commercial and industrial assureds for losses from a cyber-attack;
  • Best Non-Product Innovation – Paul Willoughby, Business Technology Manager, Beazley for MyBeazley – An etrading system for brokers designed like a consumer site; and
  • Best Under-35 Innovation – Laila Khudairi, Cyber Expert and Deputy Underwriter at Tokio Marine Kiln for Cyber Insurance with Reputational Harm – a product which combines industry-standard cyber protection with an innovative approach to reputational harm insurance.

Khudairi's winning product offers indemnification for the loss of income following cyber breach events that appear in the media.

As the recent data breach at TalkTalk demonstrates, the reputational impact of a cyberattack can be significant. "There can be huge negative impacts on brand and reputation following a data breach, and customers may well leave," explains Khudairi. "We're covering that loss to the company for up to a year following the breach, which is often uninsured."

"There is really a gap in coverage for the clients, especially with regards to social media, where reputation can really be destroyed in a matter of hours. So it's to help them rebuild that reputation but also to transfer that risk," she continues.

In his winning submission in the product innovation category, Brit's Russell Kennedy was recognised for the market's Cyber Attack Consortium.

The consortium, led by Brit, was launched in September 2014 and protects companies operating critical infrastructure and industrial machinery from terrorist and other malicious attacks.

The innovation is in new policy wordings which fit the description of a cyber attack, encompassing third-party physical damage and business interruption loss.

The judges felt the product showed vision and was genuinely new in terms of its approach and the understanding of an emerging risk. They also liked the collaborative element of the consortium, which "showed the market at its best in terms of putting together something that was challenging but needed by businesses".

Tokio Marine Kiln's Khudairi was not overly surprised that the two product innovation awards both concerned cyber risk.

"It just shows how important how cyber risk and security is," she explains. "The insurance market has to evolve and innovate to deal with these new risks that come with our increasing reliance on technology."

For his non-product innovation, Paul Willoughby was recognised for his e-trading system that allows brokers to make small price adjustments online and see the corresponding changes to cover, without the need to refer to an underwriter or for a delegated authority.

The judges felt the initiative was genuinely new in terms of taking a consumer approach to designing a system and that it was very customer-focused: "A real and genuine investment in understanding the end-users' needs and thoroughly testing the product".