Lloyd’s makes record £3.9bn

Lloyd's has announced a record £3.9bn pre-tax profit for 2009 on a combined ratio cut from 91.3% in 2008 to 86.1%.

It said its underwriting discipline compared well with estimated combined ratios of 100% for US property and casualty insurers, 94% for US reinsurers, 99% for European insurers and reinsurers and 84% for Bermudian insurers and reinsurers.

Financial highlights (2008 in brackets)

• Profit before tax £3,868m (£1,899m);
• Combined ratio 86.1% (91.3%)
• Central assets £2,084 million (£2,072m);
• Investment return £1,769m (£957m);
• Profit before tax excluding currency movements on non-monetary items £4,247m (£1,529m)
• Surplus on prior years' reserves £934m (£1,265m).

Chairman of Lloyd's, Lord Levene, said: "The hard work and very careful attention to risk in the Lloyd's market have resulted in a pre-tax profit of £3.9bn, the highest that we have ever recorded.

“The result has been achieved despite the economic turbulence that characterised most of 2009, although we were certainly helped by a low level of catastrophe related losses - helped by a benign Atlantic hurricane season. The market can be proud of what it has achieved in 2009.

"These results show that not all parts of the financial services sector are the same and, at Lloyd's, our strength and resilience means that we can face the future with confidence."

No complacency

Chief executive, Richard Ward, said: "Our 2009 results are built on a resolute focus on underwriting discipline coupled with a strong balance sheet and a conservative investment strategy.

“This has meant that, during testing times for the financial services industry, we continued to be a stable partner for businesses seeking to manage their risks.

"While the results are a testament to our strength, we cannot afford to be complacent and in 2010 we must work to continue to develop the attractiveness of the market, whilst focusing on profitable underwriting and sound risk management."