Lloyd's reveals soaring profit for H1 2019

Lloyd’s has posted a pre-tax profit of £2.3bn for the first six months of 2019, up on the £600m achieved at the start of 2018.

Meanwhile, its combined operating ratio deteriorated to 98.8% for the half-year (H1 2018: 95.5%).

Gross written premium (GWP) saw a slight uptick to £19.7bn over this period, compared to £19.3bn in H1 2018.

However, the insurance market explained that the elimination of foreign exchange rate movements and growth from new syndicates pointed to a like-for-like year-on-year reduction in GWP of 2.6%.

It added that this is the result of Lloyd’s syndicates reducing their business volumes and pulling out of certain classes of business.

Lloyd’s also stated that the results were driven by an increased net investment income of £2.3bn, a jump from the £200m reported in H1 2018.

Losses
In its full year results for 2018, Lloyd’s posted a loss of £1.0bn, which followed on from a loss of £2.0bn in the preceding year.

John Neal, Lloyd’s chief executive officer, said: “We are pleased to report a profit during the first six months of 2019. It is encouraging that the Lloyd’s market is showing increased discipline in 2019 as evidenced by a reduction in gross written premiums and an improvement in the attritional loss ratio for the current underwriting year.

“However, we recognise the importance of continued focus on performance management to maintain this momentum throughout the rest of 2019 and beyond.”

In May this year, Lloyd’s launched a transformation plan, which it said had received widespread backing from stakeholders.

Culture
The culture of Lloyd’s also found itself in the spotlight following a Bloomberg report into sexual harassment at the organisation – a move that forced it to rush through a plan to combat sexism at the insurance market. 

Neal continued: “Lloyd’s has also not hesitated to put in place a robust set of actions to tackle unacceptable behaviour around the market and ensure that we set the tone for a culture that encourages the brightest minds to remain in and join our industry.

“The centrepiece of these actions is the Lloyd’s market-wide culture survey which has built the most comprehensive picture ever commissioned of the culture across the insurance industry.

“We will be announcing the results of that survey and the actions that we will be taking at the Dive In Festival on 24 September.”

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