Lloyd’s, the world’s specialist insurance market, today announced a profit of £2,195 million for 2010.
* Profit before tax of £2,195m (2009: £3,868m)
* Combined ratio of 93.3% (2009: 86.1%) compares favourably with an estimated average of: 101.5% for US property and casualty insurers ; 95.4% for US re-insurers ; 90.8% for Bermudian insurers and re-insurers ; and 101.0% for European insurers and re-insurers
* Record level of central assets at £2,377 million (2009: £2,084m)
* Investment return of £1,258 million (2009: £1,769m)
* Release of prior year reserve surpluses of £1,016 million (2009: £934m).
Commenting on the results, Chairman of Lloyd’s Lord Levene said:
“In 2010, Lloyd’s made a profit of £2.2bn despite facing significant claims from the tragic earthquakes in Chile and New Zealand, the floods in Australia and the loss of the Deepwater Horizon oil rig in the Gulf of Mexico. The catastrophes of 2010 and 2011 have shown the crucial role insurance plays in helping communities rebuild after a crisis.
“We must also keep in mind that insurance is part of a wider financial services industry that is essential to Britain’s economic recovery. We look to the government to protect the competitiveness of our industry and its contribution to both society and the economy.”
Lloyd’s Chief Executive Richard Ward said:
“This is a solid result in a year with a slightly higher than average number of natural catastrophes. And 2011 has already been an extraordinary year of tragic natural disasters. We extend our deepest sympathies to those affected and we are working hard to make sure claims are dealt with swiftly so communities in Japan, New Zealand and Australia can rebuild and recover.
“These are challenging times for insurers. Rates have been softening, there is excess capital across the industry and investment returns are down. In 2011, we must help the market steer through the cycle, ensuring they underwrite for profit and not growth. At the same time we are positioning the market to take advantage of future opportunities by expanding in new economies and making it even easier to do business with Lloyd’s.
“Another challenge in 2011 is Solvency II and I am confident we are making good progress. However, I am increasingly concerned by the cost and complexity of this exercise. We must make sure this one piece of regulation doesn’t do lasting damage to our international competitiveness – either for Lloyd’s or the industry more widely.”