Press Release – Syndicates 33 and 435

LONDON, 9^th October 2020 – Syndicate Research Limited (SRL) today downgraded the A (Very Good), negative outlook, Continuity Opinion of Lloyd’s syndicate 33 (Hiscox Syndicates Limited) to A- (Good) in light of the syndicate’s more recent performance aligning the syndicate’s overall scorecard assessment with the top of the A- (Good) peer group. The outlook for the Continuity Opinion is stable.

LONDON, 9^th October 2020 – Syndicate Research Limited (SRL) today affirmed the A-^ (Good) Continuity Opinion of Lloyd’s syndicate 435 (Faraday Underwriting Limited). The outlook for the Continuity Opinion has been changed from stable to negative in light of the syndicate’s more recent performance aligning the syndicate’s overall scorecard assessment with the B+ (Above Average) peer group.

Lloyd’s Interim Results H1 2020

The Lloyd’s Market has 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.

Independent and Experienced in Lloyd’s Research

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

Syndicate Continuity Opinions (SCOs) – taking into account cross-cycle Returns on Capital and Group support – have been assigned to active syndicates representing some 72% of the market’s capacity, with quantitative Scorecard Indicators assigned to syndicates representing c.95% 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.

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