Lloyd’s Financial Performance Update for FY24
Lloyd’s has provided a preliminary update on its financial performance for the full-year 2024 (FY24), in anticipation of the detailed results release scheduled for March 20. This update highlights key aspects such as premium growth, underwriting success, investment outcomes, and anticipated losses from significant events.
Burkhard Keese, Lloyd’s Chief Financial Officer, emphasized the market’s sustained dedication to profitability and disciplined expansion. He also expressed concern over the California wildfires, extending sympathies to those affected. Though the comprehensive impact is still under evaluation, it is expected that the event will not pose a capital threat to the market.
Gross written premiums witnessed a 6.5% rise, reaching £55.5 billion, an increase from £52.1 billion in 2023. This growth is primarily attributed to an 8.5% rate of expansion, especially within the property and reinsurance sectors, which demonstrated robust underwriting performance. The increase encompasses a 0.3% price adjustment and a (2.3)% influence from foreign exchange fluctuations.
The market’s combined ratio recorded a slight elevation to 86.9%, a 2.9 percentage point increase from the previous year’s 84%. This was largely due to significant claims occurring in the latter half of the year. Excluding large losses, the underlying combined ratio improved to 79.1%, compared to 80.5% in the prior year.
The attritional loss ratio improved to 47.1%, showcasing ongoing underwriting prudence, while the expense ratio remained steady at 34.4%. Lloyd’s reported an investment return of £4.9 billion, slightly down from £5.3 billion in 2023. Despite experiencing some market volatility in the fourth quarter, the portfolio benefited from another year of elevated interest rates.
Underwriting profit totaled £5.3 billion, a slight decrease from £5.9 billion in 2023, while profit before tax amounted to £9.6 billion, down from £10.7 billion the previous year. Although these figures exclude the FY24 results, Lloyd’s projects a net loss of around $2.3 billion from the California wildfires based on current information.
Notably, in the first half of the year, the marketplace reported a profit before tax of £4.9 billion, an increase from £3.9 billion during the same period in 2023. Additionally, Lloyd’s achieved an underwriting profit of £3.1 billion for this period, up from £2.5 billion in the first half of 2023.
