29 Sep 2010

Profits down at Lloyd's

8:03 am on 29 September 2010

Lloyd's of London has reported a 50% fall in profits for the first half of 2010 as a result of costs from the Chilean earthquake and the oil leak in the Gulf of Mexico.

Pre-tax profits at the world's biggest insurance market were £628 million, compared with £1.32 billion a year earlier.

Chairman Lord Levene described the period as the "costliest on record".

The market paid a total of £5.9 billion in claims during the six months, £365 million more than a year ago.

Lloyd's chief executive Richard Ward told the Today programme on BBC Radio 4:

"We have seen a higher number of catastrophes this year than we have seen for the past 20 years.

"We have not had a bad year, we have just had more claims to pay."

He estimated the net loss to Lloyd's of the Chilean earthquake at $US1.4 billion, while the the Gulf oil spill cost the market between $US300 -$600 million.

Mr Ward said snow storms in the United States, wind storms in Europe and earthquakes in China and Haiti had contributed to high claims payments for the period.

He also confirmed that Lloyd's had not insured the Commonwealth Games as there was not enough information to price the risks involved satisfactorily.