COR deteriorates markedly to 114% in first loss for six years.

Lloyd’s has plummeted from a £2.1bn pre-tax profit in 2016 to a loss of £2bn in 2017.

The net swing of more than £4bn came as the combined operating ratio worsened to 114% in the past 12 months (2016: 97.9%).

The insurance market flagged that the year was “one of the costliest” for natural catastrophes in the past decade.

In particular it highlighted the frequency and scale of the disasters that struck around the world in the second half of 2017.

Investment
Major claims for the full year cost the Lloyd’s market £4.5bn, more than double the previous year’s £2.1bn figure.

There were however increases in both gross written premiums (GWP) and net investment returns in a year that saw Lloyd’s contact all staff about voluntary redundancies and ultimately issue proposals to cut headcount by 10%.

GWP rose to £33.6bn in 2017 from £29.9bn in 2016 while returns ticked up to £1.8bn (2016: £1.3bn).

Six years
Lloyd’s chief executive Inga Beale commented: “The market experienced an exceptionally difficult year in 2017, driven by challenging market conditions and a significant impact from natural catastrophes.

“These factors mean that for the first time in six years Lloyd’s is reporting a loss.”

She concluded: “Lloyd’s is here to support customers when it matters most, providing the financial support to enable businesses, governments, and most importantly people to recover and rebuild their lives as quickly as possible and I’m proud of the market’s response.”

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