Lloyd’s announced a profit of $5.29 billion for 2013, compared to $4.63 billion in 2012. Gross written premium increased to $43.14 billion, and Lloyd’s noted that its capital position further strengthened with net resources of $34.87 billion.

The earnings announcement noted that 2013 was a “benign year for insured catastrophes,” with major claims to Lloyd’s totaling $1.44 billion. Despite this, total net incurred claims were $15.87 billion in 2013, down from $16.70 billion the previous year.

Lloyd’s said U.K. flooding claims from 2013 are not expected to result in significant exposure.

Inga Beale
Inga Beale

“Disciplined underwriting and a benign year for major catastrophes have enabled us to outperform our peers and post this outstanding profit,” said Lloyd’s CEO Inga Beale. “From this base, the Lloyd’s market has a great opportunity to expand in the underinsured, high growth economies around the world.”

Lloyd’s Chairman John Nelson said that while there were few catastrophe claims in 2013, continued low interest rates saw reduced investment income and high levels of capital continuing to flow into the market, which put pressure on prices.

“These conditions look set to persist,” Nelson said. “I therefore expect increased competitive pressure on the market to remain in 2014. This underlines the need for continued underwriting discipline as we seek to maintain and reinforce our position as the global center for specialist insurance and reinsurance.”

Additional financial highlights were:

  • A combined ratio of 86.8 percent (an improvement of 4.3 percentage points from 91.1 percent in 2012) compares favorably with Lloyd’s peer group’s combined ratio of 93.4 percent.
  • Total resources of the Society of Lloyd’s and its members at $98.37 billion, from $98.03 billion in 2012.
  • Central assets of $3.94 billion from $4.11 billion in 2012.
  • Controlled premium growth of 1.6 percent, after taking account of the impact of foreign exchange and year-on-year risk adjusted rate change.
  • Investment returns of $1.39 billion, down from $2.17 billion in 2012.
  • Prior year reserve surplus releases of $2.6 billion from $2.23 billion in 2012

Source: Lloyd’s of London