Lloyd’s of London’s profit drops despite premium growth
Lloyd’s of London, the world’s leading insurance and reinsurance marketplace, has reported a profit before tax of £9.6bn for 2024, a drop from the £10.7bn reported for 2023.
The market, which is made up of more than 50 leading insurance companies and over 380 registered Lloyd’s brokers, recorded gross written premiums of £55.5bn for 2024, up 6.5 per cent from the £52.1bn recorded for 2023.
Lloyd’s of London said premium growth was driven by volume growth of 8.5 per cent (7.6 per cent from existing and 0.9 per cent from new syndicates). Price changes, which added 0.3 per cent and foreign exchange movements, which offset growth by 2.3 per cent.
Overall, the market reported an underlying combined ratio of 79.1 per cent, down from the 80.5 per cent recorded for 2023.
The major claims ratio rose to 7.8 per cent in 2024 due to significant catastrophe events, including hurricanes Milton and Helene and the Baltimore Bridge collision.
Higher prior year reserve releases, a lower attritional loss ratio, and stable expenses all contributed to the improved combined ratio.
The market also profited from a solid return on its investment portfolio. The investment return for the year was £4.9bn, down from the £5.3bn recorded in 2023.
Lloyd’s said that while the portfolio benefitted from higher interest rates overall, mark-to-market losses from fourth quarter market volatility drove the reduction in investment returns compared to the prior year.
John Neal, the of Lloyd’s of London, who announced his intention to move to insurance broker AON in January, said: “The Lloyd’s market has delivered another year of outstanding financial performance, with a superb combined ratio, underlying combined ratio and attritional loss ratio supporting a capital position and claims reserve strength that is as strong as it has ever been.
“This excellent result demonstrates the market’s ability to deliver sustainable and attractive returns for investors, and provide solutions to protect our customers’ balance sheets. I would like to congratulate members of the market for their disciplined underwriting and profitable growth and thank Corporation employees for their commitment and support in 2024.”