Lloyd’s Interim Results H1 2020

The Lloyd’s Market reported a pre-tax loss of £438m on a combined ratio of 110.4% (H1 2019 98.8%) for H1 2020, a loss of 2.8% (H1 2019 profit of 15.3%) on average capital on an annualised basis.

Total major losses for H1 were £2.6bn, 20.6% of Net Premium Earned (NPE), of which £2.4bn net, 18.7% of NPE were from COVID-19. Excluding COVID-19 major losses were 1.9% of NPE (H1 2019 1.4%).Full-year expected losses for COVID-19 are £5bn gross and £3bn net, or 11.7% of trailing 12 months NPE, in line with previously announced estimated losses of £2.5bn to £3.5bn net.

The accident year loss ratio excluding major claims improved significantly to 52.7% NPE (2019 59.7% NPE). Prior year releases were similar at 0.5% NPE (H1 2019 0.4%). Investment returns were materially reduced at 7.5% of Net Premium Earned (NPE) (H1 2019 18.2%), relative to the exceptional returns of 2019.

Lloyd’s overall loss of 3.5% NPE for H1 2020 compares to a profit of 18.3% NPE for H1 2019, the latter underpinned by the exceptional investment returns of 2019.

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