Lloyd’s faces 2017 pre-tax loss due to nat cat events: Moody’s
Lloyd’s of London faces a pre-tax loss in 2017 due to the hurricanes that struck North America in the third quarter, according to Moody’s.
Lloyd’s had previously said that it expects losses from hurricanes Harvey and Irma combined in the region of $4.5 billion, net of reinsurance, based on known modelled exposures.
Moody’s now said that it expects that the combination of the three major hurricanes Harvey, Irma and Maria will drive an overall pre-tax loss for the Lloyd’s market for 2017.
To date, Lloyd’s syndicates have already paid out more than $400 million in claims relating to Harvey and Irma, and are still in the process of quantifying the financial impact of Hurricane Maria.
With first half 2017 pre-tax profits down 16 percent year on year at £1.2 billion, absent any actions to increase available capital or reduce required capital, Lloyd’s may report a moderate erosion of its market wide Solvency II and central Solvency II ratios, which stood at 147 percent and 211 percent, respectively, as of June-end 2017, Moody’s noted.
For 2016, Lloyd’s reported pre-tax profits of around £2.1 billion, including £2.1 billion of catastrophe and large losses.
Lloyd's didn't want to comment on speculation relating to the full-year 2017 results. In the interim results published recently, Lloyd's noted that the numbers did not take into account expected losses from Harvey, Irma and Maria, but that these events would impact the full year figures.
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