Lloyd's investment returns rise to £2.1 billion in 2024

Lloyd’s investment returns rise to £2.1 billion in 2024 | Insurance Business Australia

Insurance News

Lloyd’s investment returns rise to £2.1 billion in 2024

Fixed income and equity market gains fuel strong investment performance

Insurance News

By
Kenneth Araullo

Lloyd’s has reported a profit before tax of £4.9 billion for the first half of 2024, an increase from £3.9 billion during the same period in 2023. The London-based insurance and reinsurance marketplace attributed the performance to disciplined underwriting and growth in premiums.

The market recorded an underwriting profit of £3.1 billion for the period, up from £2.5 billion in the first half of 2023. Lloyd’s gross written premium rose by 6.5% to £30.6 billion, driven by a combination of a 5% increase in volume and a 1.5% rise in prices. Foreign exchange movements negatively impacted growth by 2.1%.

The combined ratio for Lloyd’s improved to 83.7%, compared to 85.2% in the same period last year, marking the market’s best interim result since 2007. The underlying combined ratio also saw improvement, reaching 80.6%, compared to 81.6% in the first half of 2023.

Investment returns for Lloyd’s rose to £2.1 billion, from £1.8 billion a year earlier, supported by strong performance in fixed income and equity markets.

Efforts to reduce business costs at Lloyd’s led to a further reduction in the attritional loss ratio to 49.2%, down from 50.9% in the first half of 2023. The expense ratio also fell slightly to 34.5% from 35.4% in the previous year.

Lloyd’s also reported a robust capital position, with a central solvency ratio of 520%, up from 503% at the end of 2023. The market-wide solvency ratio stood at 206%, nearly unchanged from 207% at the end of last year, underscoring the market’s capital discipline.

The firm’s financial stability was recognised by rating agency AM Best, which upgraded Lloyd’s financial strength rating to A+ (superior) and its long-term issuer credit rating to AA- (superior), with a stable outlook.

John Neal, CEO of Lloyd’s, said the results reflected strong underwriting, organic growth, and the robustness of Lloyd’s balance sheet. He noted the results would benefit both investors in the marketplace and customers navigating an increasingly complex risk environment.

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