Press Release

London, 16th April 2019 – Syndicate Research Limited (SRL) today downgraded the B-^ (Below Average) Continuity Opinion of Lloyd’s syndicate 1301 (StarStone Underwriting Limited) to C+^ (Below Average) following the announcement of syndicate 1301’s 2018 annual result. The outlook for the Continuity Opinion has been changed from stable to negative.

Lloyd’s Full Year Results

The Lloyd’s Market has reported a pre-tax loss of £1,001m on a combined ratio of 104.5% (2017 114.0%) for 2018, being a loss of 4% on average capital (2017 7% loss). The result benefited from the material reduction in major losses relative to 2017, this being offset by reduced investment returns.

The results were materially impacted by the H2 2018 Hurricanes, Typhoons & Wildfires with Major Losses 12% of Net Premium Earned (NPE) (2017 19%). The attritional loss ratio reduced to 58% NPE (2017 59%) and prior year releases increased to 4% NPE (2017 3%). Investment returns reduced materially to 2% NPE (2017 7%); total expenses remained static at 41% NPE (2017 41%).

Lloyd’s overall loss of 4.0% NPE compares to a loss of 8.2% NPE in 2017.

SRL notes that the accident year combined ratio excluding major losses currently remains 97% (calendar year combined ratio excluding major losses 93%, net of prior year releases) and compares to the 10-year average major claims for Lloyd’s of 10% NPE. However, SRL recognises that the improvements following Lloyd’s Performance Review of 2018 have yet to flow through to the reported results.

Syndicate annual results ranged from a profit of 73% NPE to a loss of 145% NPE for those syndicates trading in 2018.

Independent and Experienced in Lloyd’s Research

Syndicate Research Limited (SRL) provides in-depth research on all trading syndicates operating in the Lloyd’s of London insurance market.

Syndicate Continuity Opinions (SCOs) have been assigned to active syndicates representing some 73% of the market’s capacity, with quantitative Scorecard Indicators assigned to syndicates representing c.92% of the market’s capacity.

With a combined experience of the Lloyd’s market of over 50 years, our team produces research which is used by clients the world over.

We value our independence; we do not accept payment from the syndicates or managing agents for coverage of their businesses.