Lloyd’s posts ‘best result in recent history’ as prices rise for 24 consecutive quarters
Combined ratio lowest since 2007
Lloyd’s said it delivered its “best result in recent history” last year as profit swung back to £10.7bn from a loss of £800m in 2022, boosted by the previously announced big jump in underwriting profit, and a much lower combined ratio helped by 7% rate increases.
The market suffered heavy investment losses in 2022 of £3.1bn that saw it fall into the red. But investments delivered a profit of £5.3bn in 2023 and helped Lloyd’s deliver its impressive headline figure.
Lloyd’s also saw its underwriting profit more than double last year to £5.9bn from £2.6bn, helped by the 7% price rises. The market has now seen 24 consecutive quarters of price increases.
Its combined ratio improved 7.9 percentage points over the prior year to 84% from 91.9%. This is its strongest result since 2007.
Lloyd’s said underwriting benefited from lower costs from large risks and natural catastrophe claims.
The market increased gross written premiums by 11.6% in 2023 to £52.1bn, with volume growth of 4% on top of the higher prices.
Its attritional loss ratio fell to 48.3% and the expense ratio was flat at 48.4%.
Central and market-wide solvency ratios were 503% and 207% respectively, from 412% and 181% in 2022. Total capital, reserves and subordinated loan notes increased 12.7% to £45.3bn.
John Neal, CEO of Lloyd’s, said: “The results we’re reporting today are our best in recent history, with an outstanding underwriting result underpinned by a strong and resilient balance sheet.”
“Our ability to attract – and provide returns on – capital is vital to ensuring we can support our customers through uncertainty. We’ll continue working with our market to deliver consistent profitable performance through disciplined underwriting – enhancing the value, relevance and long-term sustainability of Lloyd’s,” he added.
