Twice a day the “Chatham Van” leaves Lloyd’s of London in the heart of the City for the 66-mile round trip to the insurance market’s administrative offices in Kent. On each journey, at 10am and again at 3.45pm, the van is laden with reams of claims-related paperwork central to the functioning of the 317-year-old market.

The paper mountain weighs four tonnes and three vehicles are needed for the task. The cost has yet to be calculated, but the Chatham Van will soon make its last journey in a move that Lloyd’s executives say is crucial to the survival of the world's oldest, and largest, insurance market.

Yesterday Richard Ward, the chief executive, set the tone when he fired off a stiff letter to Lloyd’s underwriters. It threatened to force them to handle every part of an insurance claim electronically unless their poor adoption of modern processes shows real signs of improvement.

“I have no doubt that there is a shared will in the market to improve our processes and much progress has been made,” Mr Ward wrote in the letter. “The pace of change, however, is still too slow. The systems are available, further versions are being rolled out on schedule and we are not aware of any material barriers to brokers and managing agents utilising them.”

Mr Ward told members that failure to improve would represent a “significant risk” to the market’s efficiency and said that the Chatham Van would be phased out next year.

Ironically, the van is run on a modern outsourcing arrangement with Lloyd’s joint venture Xchanging.

While Mr Ward has won plaudits for insisting that he will meet his target of moving the market all-electronic by Christmas, underwriters say that he faces lethargy among syndicate players used to traditional methods. A leather-bound claims file containing all related insurance documents, is still moved manually between brokers and various risk underwriters, for example.

But Mr Ward is not about to give up. He and the Franchise Board that controls Lloyd’s plan a number of measures to punish members who refuse to meet the target of processing 60 per cent of claims electronically by the end of September. These include naming and shaming of underperformers, visits to all underwriters to seek explanations for noncompliance and, finally, imposing the system on persistent Luddites or forcing them to set aside more capital to cover their risks.

Heavyweight Lloyd’s underwriters welcomed his style. Bronek Masojada, chief executive of Hiscox and a driving force in a Lloyd’s market reform group known as G6, said: “I absolutely welcome this . . . Richard has the room to raise the temperature a bit more. The market will change if it sees a big enough threat to its current way of doing business.”

Charles Philipps, chief executive of Amlin, said: “More progress has been made in the last 18 months than in a long while previously. Forcing those who are dragging their heels to come into line is a necessity if the market is to secure maximum benefit from all the good work being done.”

Tracking down an underwriter prepared to dismiss electronic trading is virtually impossible. “Nobody would suggest that this is as easy to use as Amazon. It’s clunky but it works,” one underwriting boss said. Finding an underwriter prepared to mourn the absence of the Chatham trip may well be another matter.