Disasters drive Lloyd's of London to H1 loss
LONDON (AP) — Insurance claims from earthquakes in Japan and New Zealand, floods in Australia and tornadoes in the United States drove Lloyd's of London to its biggest-ever first half loss, the insurance market said Wednesday.
Lloyd's, which has no connection with Lloyds Banking Group PLC, said it received claims totaling 6.7 billion pounds ($10.5 billion) from the combined disasters. That led to a first-half pretax loss of 697 million pounds.
Lloyd's said the predicted claims of 1.2 billion pounds from the Japanese earthquake and tsunami would make it the fourth-largest event to hit the market. The biggest was Hurricane Katrina in the U.S. in 2005, which produced 2.4 billion pounds in claims.
In the first half of last year, Lloyd's turned a profit of 628 million pounds despite dealing with claims from the Deepwater Horizon oil rig disaster in the Gulf of Mexico and an earthquake in Chile.
"The claims seen so far in 2011 arising from major events have already exceeded the total for 2010 and we have not yet reached the end of the Atlantic hurricane season," said Lloyd's chairman, Peter Levene.
He added that historically low investment yields in many classes of business have added to the challenge.
Lloyd's is a society of corporate underwriters and wealthy individuals that make insurance transactions through 88 syndicates. It is the world's fifth-largest insurer measured by premium income.