Global: Lloyd's reports $6.4bn profit, combined ratio up by 83.7% at 1H
Source: Middle East Insurance Review | Oct 2024
Lloyd’s has announced results for the first six months of 2024, with an overall profit before tax of GBP4.9bn ($6.4bn) against GBP3.9bn in the same period of the previous year. The market demonstrated continued discipline through 1H2024, delivering an underwriting profit of GBP3.1bn (HY 2023: GBP2.5bn), a GBP600m increase on the previous year.
Lloyd’s continued to support sustainable profitable growth, with GWP increasing by 6.5% to GBP30.6bn (HY 2023: GBP29.3bn) excluding foreign exchange movements (-2.1%), driven by volume growth (5%) and price increases (1.5%).
The market’s combined ratio improved y-o-y to 83.7% (HY 2023: 85.2%), its best interim result since 2007. The underlying combined ratio improved to 80.6% (HY 2023: 81.6%).
The investment return of GBP2.1bn (HY 2023: GBP1.8bn) was primarily driven by strong fixed income returns complemented by high growth in equity markets.
The drive to improve performance and reduce the cost of doing business at Lloyd’s has resulted in a further 1.7% reduction in the attritional loss ratio to 49.2% (HY 2023: 50.9%), and an improving expense ratio down to 34.5% (HY 2023: 35.4%).
Lloyd’s maintained a strong balance sheet with a central solvency ratio of 520% (FY 2023: 503%) and market-wide solvency ratio of 206% (FY 2023: 207%), highlighting the market’s capital discipline and resilience.
Lloyd’s sustainable profitability and resilient capital position were reflected in AM Best’s upgrade of the financial strength of the Lloyd’s market to A+ (superior) from A (excellent) and the long-term issuer credit rating to AA- (superior) outlook stable from ‘A+’ (excellent), outlook positive.
Lloyd’s CEO John Neal said, “The first half of 2024 has presented a superb set of results for the Lloyd’s market which represents a combination of disciplined underwriting, smart organic growth and real strength in the Lloyd’s balance sheet. This is good news for both investors in the Lloyd’s insurance marketplace and our customers as we continue to support them in an increasingly risky world.” M