The next chief executive of the Lloyd's of London insurance market could be hired from outside the industry, said chairman Lord Levene, himself an insurance 'outsider' when he took up oversight for the world's oldest insurance market a little more than three years ago.

Former CEO John Prettlejohn left Lloyd's on December 31. Lord Levene said in an interview yesterday, coinciding with his visit to Bermuda to take part in this week's World Insurance Forum, that a replacement is to be announced "very soon".

"We are getting towards the end of that process," and said Lloyd's has cast a wide net in its candidate search. And he didn't rule out hiring the new chief executive from outside the insurance industry.

A new three-year strategic plan recently unveiled by the Lloyd's of London market to make the market the "platform of choice" for to place large property and casualty risks, will become the "number one priority of the market's new chief executive".

Lord Levene, 64, is himself the first chairman to come from "outside the insurance world". He's three months into his second three-year term as Lloyd's chairman, one of the world's most major insurance markets.

The former chief of defence procurement under Margaret Thatcher, also oversaw the building of Canary Wharf, worked for investment bank Morgan Stanley and was Lord Mayor of London ? at the same time as working for Deutsch Bank ? before joining Lloyd's.

"It is a good idea to bring somebody in from outside, otherwise it is too introspective," he said of his own appointment. "Am I always right? Of course not, but the idea is to challenge people."

Lloyd's of London had some rocky patches before Lord Levene's time, most recently in 2001 when it nearly collapsed under the weight of $3 billion in claims from the September 11, 2001 terrorist attacks.

Four years later, the company sustained losses exceeding $5 billion in the 2005 hurricane losses, and no one really blinked an eye, said Lord Levene.

"People have accepted that we know what we are doing," he said. "There is a lot more discipline in the market. Last year we deliberately cut back our capacity. Why? Because we wanted to remove the tendency to just write business at any price. Top line business is not what it is all about."

The about-face hasn't come without some real changes for the market.

Three years ago, Lloyd's hired a Franchise Performance Director to oversee regular reviews of its members' business plans, with the power to turn down plans that don't stand a strong chance of being profitable.

Under the franchise performance review of the market, Lord Levene said those overseeing the programme can make a "good assumption" on where the market stands, and is heading. "The actuality is that every underwriter has to present their business plan every three months," he said.

There are examples of Lloyd's having used its new muscle: In late 2003 it ordered Goshawk Insurance Holdings Plc, the parent company of Rosemont Re, a Bermuda reinsurer effectively put into run off last year after heavy hurricane losses, to quit selling policies out of the market after losses eroded the company's capital.

Lord Levene said clamping down on some of its members' activities when losses spiralled made everyone else take a serious look at underwriting discipline.

And some imbalances got fixed by the members themselves, through consolidation. "It is not just the weak being taken over by the strong, but sometimes two getting together because they would be stronger as one. It is up to them."

When Lord Levene took up the chairmanship of Lloyd's there were 200 members, that number has now shrunk to 62. And up to 85 percent of the market is now made up of commercial insurers.

The Lloyd's market was traditionally the haven of private backers, or Names. Lord Levene said the private capital that now remains in Lloyd's is "much more focused" and now more concentrated. "They are now savvy, sophisticated investors."

While the market has made strides, Lord Levene said it still has far to go.

"Our priority has to be to be smarter to be more efficient to be more cost effective and to be faster.

"We have to bring Lloyd's out of the paper age, with everyone walking around with bundles of paper under their arms."

He said that alone would shave costs because, as services were automated, the number of people needed in the market would be reduced. "People are expensive," he said.

The process of instituting reforms to how the market does business is getting somewhere but there is "a long way to go", he added.

An example of the distance Lloyd's has come: The company used to be several years behind in producing financial data. That isn't the case now.

"If you ask anybody here, or in Lloyd's, what they would criticise (about Lloyd's) they'll say the cost of doing business, and the speed. And both those things we are working on."