Lloyd’s posts best H1 underwriting performance in 17 years as profit tops £4.9bn

Lloyd’s has reported a combined ratio of 83.7 percent for the first six months of 2024, its best interim result since 2007, as pre-tax profit totalled £4.9bn ($6.4bn).

The result marked a year on year improvement of 1.5 percentage points, while the underlying combined ratio improved slightly to 80.6 percent from 81.6 percent in H1 2023.

The £4.9bn pre-tax profit continued the market’s recent run of profitability, having swung to a £3.9bn half-year gain in 2023 following a loss of £1.8bn in the first half of 2022.

Underwriting profit increased by 24 percent to £3.1bn, while GWP was up 6.5 percent to £30.6bn, excluding foreign exchange movements.

The increase in GWP was fuelled by a combination of volume growth (5.0 percent) and price increases (1.5 percent).

Lloyd’s posted an investment return of £2.1bn, primarily driven by strong fixed income returns and complemented by high growth in equity markets.

Following efforts to improve performance and reduce the cost of doing business at Lloyd’s – a familiar pain point cited by several firms – the market recorded a 1.7 percent reduction in the attritional loss ratio to 49.2 percent, as well as a slight reduction in the expense ratio to 34.5 percent.

The central solvency ratio increased from 503 percent in H1 2023 to 520 percent, while the market-wide solvency ratio stood at 206 percent.

“The first half of 2024 has presented a superb set of results for the Lloyd’s market which represents a combination of disciplined underwriting, smart organic growth and real strength in the Lloyd’s balance sheet,” commented John Neal, CEO of Lloyd’s.

“This is good news for both investors in the Lloyd’s insurance marketplace and our customers as we continue to support them in an increasingly risky world.”