Lloyd’s announced overall first half profits of £1.3 billion ($2.553 billion), slightly below the £1.38 billion ($2.61 billion) it earned in the same period of 2005. Unfortunately Katrina, Rita and Wilma wiped out the profit and then some with £3.3 billion ($6.24 billion] in losses.
This year looks to be a good deal more benign in terms of the weather. While Lloyd’s said it is impossible “to predict any full-year result,” it also said that “today’s interim report shows that the prospects for the market are good.”
Lloyd’s Syndicates reported an impressive 20 percent improvement in underwriting profit. The minimal earnings decline during the period was due to “a smaller contribution from investment income,” said Lloyd’s.
Other highlights included the following:
— Combined ratio of 86 percent (first half ending 30 June 2005: 87.3 percent), compared with an estimated average of 93 percent for US property & casualty insurers; 96.5 percent for US reinsurers ; 88 percent for Bermuda, and 93.2 percent for European insurers and reinsurers;
— Increased central assets to £1.401 billion ($2.65 billion) (31 Dec 2005: £1.265 billion – $2.4 billion); and
— Solvency ratio increased to 529 percent (31 Dec 2005: 384 percent)
An obviously pleased Lloyd’s Chairman Lord Levene commented: “These are an excellent set of results. Today’s numbers clearly show the underlying strength of the market. Lloyd’s, in the first half of 2006, outperformed its major international peer groups due to a combination of good market conditions and the strong underwriting discipline within the market.”
Lloyd’s new CEO Richard Ward added: “Five new syndicates have joined the market in the last year, which together with the £2 billion [$3.75 billion] of fresh capital during the same period demonstrates once again Lloyd’s continuing appeal as a place to do business.”
The full report and a recorded version of the webcast meeting for investors and investment analysts is available at: www.lloyds.com.
Was this article valuable?
Here are more articles you may enjoy.