Global insurance losses from the COVID-19 pandemic will be higher this year than Lloyd’s of London had previously estimated.
Lloyd’s had previously projected global COVID-19 losses would be about $107 billion, according to Reuters. However, Lloyd’s chairman Bruce Carnegie-Brown said at the Reuters Future of Insurance USA conference that pandemic-related losses will be on par with 2017, when three Atlantic hurricanes drove catastrophe costs to $144 billion, the highest on record, according to Swiss Re.
Lloyd’s firms are facing claims from 16 different business lines, Reuters reported.
“Unlike many events, a pandemic is everywhere at the same time,” Carnegie-Brown said. He added that the pandemic had extended longer than expected.
Lloyd’s, which operated a commercial insurance marketplace, said it will pay £2.4 billion in pandemic-related claims for the first six months of 2020, Reuters reported.
Lloyd’s has proposed a “Black Swan” reinsurance scheme to governments around the world to better cover during circumstances like the pandemic, Reuters said. However, Carnegie-Brown said it was hard to get governments to pay attention.
“The challenge for governments, of course, is that they are very short-term focused. … [It is] very difficult for them to lift their heads above the parapet and think about the future,” he said.