Lloyd’s suffers profit slide, even without storm impact

Insurance market faces a bill in the region of SGD$6.19 billion for hurricanes

Lloyd’s suffers profit slide, even without storm impact

Insurance News

By Terry Gangcuangco

Lloyd’s has reported pre-tax profits of £1.22 billion (SGD$2.22 billion) for the first half of 2017 – a decrease from £1.46 billion (SGD$2.66 billion) for the same period last year, no thanks to continuing pressure on pricing from excess capital and low interest rates.

Here are the other financial figures, compared to the first half of 2016:
  • 8.9% annualised return on capital, down from 11.7%
  • 96.9% combined ratio, compared to 98%
  • 1.5% investment return, down from 1.8%
  • £18.9 billion gross premiums, up from £16.3 billion

The specialist insurance and reinsurance market noted that the figures do not take into account the recent storms in the United States and the Caribbean. Instead, they are a reflection of what Lloyd’s said had been a relatively benign loss period.

“These results highlight the continued strength of the Lloyd’s market, but they do reflect the challenging conditions that have shaped the sector over recent years,” commented Lloyd’s chief executive Inga Beale.

She added: “While these results do not cover the current hurricane season in the Caribbean and United States, the market is assessing claims and starting to make payments that will help local communities and businesses get back on their feet as quickly as possible.”

Lloyd’s is reportedly facing a claims bill of £3.4 billion (SGD$6.19 billion) for hurricanes Harvey and Irma.

Related stories:
Lloyd’s grabs catastrophe specialist from SCOR
Lloyd’s may enjoy tax break for new office

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