Lloyd's name comes from the name of Edward Lloyd who opened a cafe in the financial sector in the City of London in 1688. Soon, they began to gather in the cafeteria businessmen and merchants of products coming from and destined for overseas.
Gradually it came up among customers of the cafe, the idea of sharing the risks of transporting goods. Gradually he developed the business of signing parties or share the value of a shipment. These subscribers or "Underwriters" became known as "Lloyd's Underwriters' business and to sign and share the risks of a shipment is called an "Insurance".
The document called "The Policy", circulated until the total value of the risk to be covered. These "Policy" had an almost equal size to that used now and each "Underwriter" signs each one thing, that is, each signatory is responsible for its share of risk assumed.
Edward Lloyd was not involved in the insurance business. Along with managing the cafeteria, in 1696 he began publishing a newspaper with information relating to ships, shipping and items of general interest to its customers. However, its main function was to provide a place where those transactions take place.
With the death of Edward Lloyd, it became necessary to have a place where the "Underwriters" could continue with their business. In 1770, the "Society of Lloyd's", a voluntary society, a kind of union grouping, made available to its members meeting rooms in Pope's Head Alley, London. Later the company moved several times to occupy a building for the same purpose in 1928 at Lime Street, London.
Until 1871, the Lloyd's Society had functioned as a kind of private club with a steering committee. In that year he was formalized by an Act of Parliament, the creation of the "Lloyd's Corporation." The Act begins with the following words: "has long existed in the City of London, a group or society that previously operated in the Cafeteria Lloyd's ..."
Although radically different in its proportions, the functions of the Corporation are not so different from that in developed cafe owner from which it derived its name. It provides its "Members" rooms in which to develop its activities and publishes daily. "Lloyd's List", established in 1734, after the "London Gazette", is the oldest publication in England.
The methods used to conduct insurance business are very similar to those used in the 17th century made on Insurance Contracts are signed with Lloyd's individual "Underwriters", "everyone for himself". Only they are responsible and only they can bring their lawsuits. Edward Lloyd was never responsible for transactions carried out on your property. Similarly, Lloyd's is not liable for the activities of its members. Lloyd's could not get lawsuits because of policy benefits in the café and, likewise, can not prosecute the "Corporation".
The Corporation's business grew, forcing it to stabilize its precarious system which involved representatives ensured their interests abroad. In 1811, Lloyd's Committee established the system of Lloyd's Agents. In addition to their normal professional activities, these agents must perform specific functions for the Lloyd's Corporation. As agents, they must collect and submit to the Corporation any information that may be of interest to the Lloyd's market and insurers worldwide.
Then, it became common for insurers, both members of Lloyd's as insurance companies worldwide, incorporating in the terms of the policies and certificates issued, the need for inspections to determine the extent and cause of damage or loss the ship and its cargo or cargo transported by sea, air or land. These reviews should be carried out by inspectors from Lloyd's Agents. Importantly, when a Lloyd's Agent makes an inspection at the request of an insurer, adjuster or broker that is not part of Lloyd's, he is doing it by the applicant and not on behalf of Lloyd's itself. In addition to inspections, the Lloyd's Agents are responsible, in cases where the policy or certificate so indicates, for adjustment and payment of claims.
Many wonder why the transport of charge is called "shipping" or in English "marine insurance" when covering also goods transported by air or land. When he started the business of insurance, it was completely related to cargo transported on ships. However, when he began the mass transport by rail, truck and then by airplane, the term "marine" remained.