Lloyd's is in the first place an association of underwriters, each of whom conducts his business according to his own views. For those views, or for the business transacted by individual underwriters, Lloyd's as a corporation is in no way responsible, except that the committee of Lloyd's before the election of any underwriting member requires that the candidate shall place in the hands of the committee security to meet his underwriting liabilities. For many years this custom has prevailed, and the total securities thus placed at the disposal of the committee of Lloyd's amount to about £4,000,000. It is difficult to estimate the value of property annually insured at Lloyd's, but it probably amounts to about £400,000,000. Lloyd's as a corporation, and the committee as its executive, have little to do with marine insurance. Their business is to conduct the affairs of Lloyd's in its corporate capacity, to carry out the supply and distribution of shipping intelligence, and to guard as trustees the corporate funds and corporate property.
The name of Lloyd's is derived from a coffee-house kept by Mr Edward Lloyd in the 17th century. In 1692 Lloyd's coffee-house moved from Tower Street to Lombard Street, where it became the centre of shipping and underwriting business; and in 1774 Lloyd's moved from the coffee-house in Lombard Street to the north-eastern premises of the Royal Exchange, where it occupied, on the first floor, the rooms hitherto held by the East India Company. The wars, which lasted from 1775 with but short pauses till 1815, raised Lloyd's to the high position which it now holds, bringing home to merchants the necessity of covering their risks as effectually as possible. High premiums adequate to high risks were offered. Merchants of wealth became insurers of property afloat, and tens of thousands were written in the names of single underwriters at Lloyd's. The wars had the effect of bringing foreign marine insurance from all parts of the world to Great Britain, since the security of Lloyd's then, as now, was unequalled in the world. The membership of Lloyd's has greatly increased: in 1850 there were 210 underwriting members; in 1890, 592.
In the second place, Lloyd's is an enormous organisation for the collection and distribution of marine intelligence. The intelligence department of Lloyd's was originally established at Lloyd's coffee-house to meet the public desire for information with regard to vessels at sea. Lloyd's News was established in 1696, and resuscitated in 1726 under the name of Lloyd's List, which is thus the oldest newspaper existing in Europe at the present time, with the exception of the London Gazette. The intelligence department at Lloyd's has continually developed. During the Napoleonic wars the government was often indebted to the committee of Lloyd's for the earliest information of transactions all over the world.
The great wealth of Lloyd's, and the fortunes made there, attracted general attention, and in 1810 parliament appointed a committee to inquire into the affairs of the institution. From this inquiry Lloyd's emerged victoriously, and since that time has continued to assist in the promotion of every measure which might aid in the preservation of life at sea, the prevention of fraud in connection with marine insurance, and the rapid collection and distribution of maritime intelligence to all interested. The corporation has its agents in every port, and there is no line of sea-coast in the whole world which is not watched by some representative of Lloyd's. In 1871 Lloyd's was incorporated by act of parliament. The general introduction of telegraphy has caused an enormous development of the information received at and distributed from Lloyd's. Various works are published by the corporation for the benefit of the mercantile community, such as Lloyd's List, Lloyd's Weekly Shipping Index, and Lloyd's Confidential Index. The Mercantile Navy List, International Code List, and British Code List are edited by the Registrar-general of Seamen, and published by Lloyd's. At Lloyd's is also maintained a Captains' Register, showing the services of every master in the mercantile marine; and much confidential information of great value to underwriters is collected in the secretary's office for the benefit of members and subscribers to the corporation.
The value of signal-stations as a means of providing early shipping information is great, not only to underwriters, but to owners of vessels and cargoes, as it is frequently of advantage that a vessel making for some particular port should be intercepted and ordered to some other port. Vessels arriving off outlying signal-stations bring important intelligence as to derelicts and wrecks passed on their voyages; as also information of vessels in distress and requiring assistance. Vessels arriving from long voyages overdue are also reported at these stations. Not one vessel in ten bound to ports in the United Kingdom from distant ports arrives at her terminal port without first being reported from one of Lloyd's signal-stations. The corporation of Lloyd's now holds a similar position with regard to signal-stations to that occupied by the corporation of the Trinity House with regard to lighthouses. These valuable aids in the preservation of life and property are one of the latest developments of this great corporation. Lloyd's also maintains an 'Inquiry Office,' where the relations of the crew or passengers in any vessel may obtain information without cost concerning the movements of that vessel or any other matter of interest to them.
LLOYD'S REGISTER is a society voluntarily maintained by the shipping community with the primary object of classifying vessels according to their strength and efficiency for the safe carriage of cargoes. It is the recognised authority on such matters in the United Kingdom, and also to a very considerable extent in foreign countries. The society's affairs are managed by a committee of fifty members, composed of merchants, shipowners, and underwriters, elected to represent the important shipping centres of the country. The numerous duties of the society are executed under the control of the committee by a staff of 134 ship and engineer surveyors in the United Kingdom, and of 121 appointed at the principal foreign ports. Rules are published annually by the society, embodying the best current practice in the construction of ships and engines. Both new and old vessels can be classed under these rules. In the case of a new vessel the plans for construction are in the first instance submitted to the committee, by whom they are examined and returned with such modifications as are considered requisite. The building of the vessel then proceeds under the supervision of the local surveyor, and when she is completed the surveyor forwards a detailed report for the consideration of the committee by whom the character is assigned.
Wood ships are assigned the character A1 as a first class for a term of years varying according to the materials and fastenings used in their construction. Lower grades of character are expressed by the symbols A1 in red and Æ. Iron and steel vessels are classed for an indefinite period under a system of frequent surveys, the varying degrees of strength being indicated by the characters 100A1, 90A1, and 80A1. Nearly 90 per cent. of the tonnage constructed in the United Kingdom is built under the supervision of the society's surveyors and classed in the register-book. Altogether, over 8000 vessels of nine and a quarter million tons hold a classification assigned by Lloyd's Register, subject to periodical inspection by the society's officers.
The inspection of the machinery and boilers of steam-vessels during and after construction comes also within the scope of the society's functions. Under the authority of government it controls the testing of anchors and chains at eight out of the nine proving-houses in the country, in accordance with the provisions of the Chain and Anchor Act of 1871. It tests the steel intended for use in constructing ships and boilers, and inspects large forgings and castings; it provides for the survey and classification of yachts; and it has been entrusted by government with the fixing of maximum load-lines to merchant-vessels.
Lloyd's Register issues annually to its subscribers a register containing particulars of the classification of vessels to which characters have been assigned, together with many other details, constituting a very full record of their construction, history, &c. All other sea-going vessels of the world of 100 tons and upwards are included in the work, which contains particulars of the age, build, tonnage, dimensions, ownership, &c. of some 32,000 vessels. The society has existed in its present form since 1834, when it superseded two rival institutions having a similar object. The offices of the society are situated in White Lion Court, Cornhill, London.
Amongst several marine institutions bearing the name of Lloyd in different parts of the world, the most important are the Austrian and the North-German Lloyd. The former has its seat at Trieste. It was organised as a marine insurance society in 1833, but three years later enlarged the sphere of its activity by founding also a share company for steam-navigation to the Levant and Black Sea. Its vessels also traverse the Red Sea and the Indian Ocean, going as far as Hong-kong. The North-German Lloyd is primarily a shipping company, whose headquarters are at Bremen. It was founded in 1857, and maintains communication by means of large, swift, and excellently equipped ocean steamships with New York and Baltimore, Brazil and the River Plate, and (since 1885) with eastern Asia and Australia. See F. Martin's History of Lloyd's (1875), Annals of Lloyd's Register (1884), and Chambers's Journal (1886).