Lloyd’s does well from quiet year
Lloyd’s has bounced back from big hurricane losses in 2005 to record a pre-tax profit of £3.7 billion ($8.9 billion) for 2006.
The market, which had a loss of £103 million ($249 million) in 2005 after hurricanes on the US Gulf coast and the Caribbean, came out punching after strong underlying conditions and an exceptionally low level of catastrophes.
CEO Richard Ward says the market is in a strong competitive position and its performance compares well with global peers.
“We’ve had two exceptional years in 2005 and 2006,” he said. “2005 was exceptional for its high level of catastrophe losses, while 2006 was exceptional for the completely opposite reason.”
Lloyd’s premium income rose 10% to £16.4 billion ($40 billion), and its combined ratio improved to 83% from 111.8% the previous year.
“As we move into 2007 we are urging caution,” Mr Ward said. “We are encouraging the market to look very closely at the business they write to ensure it still makes sense at the rates being offered.”
Lloyd’s Chairman Lord Levene says 2006 was an excellent year but it would be unrealistic to expect such a favourable claims experience this year.
“With a trend for more frequent and severe natural catastrophes, we must continue our focus on underwriting for profit. The market is well prepared to meet these challenges.”
The market, which had a loss of £103 million ($249 million) in 2005 after hurricanes on the US Gulf coast and the Caribbean, came out punching after strong underlying conditions and an exceptionally low level of catastrophes.
CEO Richard Ward says the market is in a strong competitive position and its performance compares well with global peers.
“We’ve had two exceptional years in 2005 and 2006,” he said. “2005 was exceptional for its high level of catastrophe losses, while 2006 was exceptional for the completely opposite reason.”
Lloyd’s premium income rose 10% to £16.4 billion ($40 billion), and its combined ratio improved to 83% from 111.8% the previous year.
“As we move into 2007 we are urging caution,” Mr Ward said. “We are encouraging the market to look very closely at the business they write to ensure it still makes sense at the rates being offered.”
Lloyd’s Chairman Lord Levene says 2006 was an excellent year but it would be unrealistic to expect such a favourable claims experience this year.
“With a trend for more frequent and severe natural catastrophes, we must continue our focus on underwriting for profit. The market is well prepared to meet these challenges.”