Lloyd’s bounces back to profitability and bullish outlook with ‘strong’ H1
Insurance and reinsurance marketplace Lloyd’s of London reported a remarkable rebound in profitability in both underwriting and investments for the first half of 2023. CEO John Neal (pictured) praised the firm’s performance, highlighting its “bulletproof balance sheet” and an optimistic financial forecast for the year.
Lloyd’s reported a profit of £3.9 billion for the first six months of this year, a significant turnaround from the £1.8 billion loss in the same period of 2022.
The underwriting profit more than doubled to £2.5 billion, up from £1.2 billion in HY 2022. Additionally, the investment return stood at £1.8 billion, compared with a £3.1 billion loss the previous year.
The market’s combined ratio improved 6.2 percentage points to 85.2% from 91.4% in HY 2022, thanks to “continued progress in underwriting performance”.
Gross written premiums saw a 21.9% rise, reaching £29.3 billion, up from £24.0 billion in HY 2022. This was driven by growth from existing syndicates (6.5%), new syndicates (2.2%), foreign currency movements (4.1%) and risk-adjusted rate increases (9.1%). Notably, major claims made up 3.6% of the losses in the year's first half.
Furthermore, Lloyd’s financial foundation solidified, boasting a central solvency ratio of 438% and an overall market solvency ratio of 194%.
Lloyd’s CEO Neal said: “We’re pleased to be reporting a very strong set of results for the year so far – with profitability in both our underwriting and investments; a leading combined ratio, strong premium growth and a bulletproof balance sheet that means we can support customers through a range of shocks and scenarios.
“Combined with the market’s progress in driving sustainable performance, digitalisation and showing leadership from climate transition to culture change – these results set us up to deliver on our positive financial outlook for 2023.”
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