Lloyd’s Bounces Back from 2011 Loss: Posts $4.517 Billion 2012 Profit

March 28, 2013

Lloyd’s announced an overall profit of $4.517 billion for 2012, making the $800 million loss in 2011, the costliest year on record for natural catastrophes, a fading memory.

Controlled growth in 2012 saw gross written premium income reach a record high of $40.5 billion, partly as a result of average rate rises of 3 percent, the earnings announcement said.

Total net incurred claims were $16.1 billion, down from $20.6 billion in 2011.

The claims included $2.2 billion from Superstorm Sandy, which struck the Caribbean and North America in October 2012, becoming one of the largest claims in Lloyd’s 325 year history. Lloyd’s central assets were also at record levels of $4.1 billion.

CEO Richard Ward said the firm posted “a strong result, despite incurring $16 billion of total net claims in 2012.”

Other financial highlights included the following:

  • A combined ratio of 91.1 percent (an improvement of 15.7 percentage points from 106.8 percent in 2011), which Lloyd’s said “compares favorably” with its peers: 107 percent for U.S. property and casualty insurers; 96 percent for U.S. reinsurers; 91 percent for Bermudian insurers and reinsurers; and 98 percent for European insurers and reinsurers.
  • Total resources of the Society of Lloyd’s and its members at $96.612 billion (2011 £580.87 billion [$88.9 billion].
  • Controlled premium growth of 9 percent (2012 £25.5 billion [$38.68 billion]; 2011 £23.477 billion [$35.613 billion]), which includes an average 3 percent rate increase.
  • Investment return of $2.084 billion (£1.311 billion: 2011 £995 million [$1.51 billion]).
  • Central assets of $4.051 billion (£2.485 billion: 2011 £2.388 billion [$3.622 billion).
  • Prior year reserve surplus releases of $2.202 billion (£1.351 billion: 2011 £1.173 billion [$1.779 billion]).

Source: Lloyd’s of London

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