Lloyd’s, the world’s leading marketplace for commercial, corporate and specialty risk solutions, today announced a strong set of financial results for the Full Year 2022 (FY2022).
The market’s profitable growth continued with Gross Written Premium (GWP) increasing by 19% to £46.7bn (FY2021: £39.2bn), including 4% volume growth.
Lloyd’s focus on sustainable performance resulted in an underwriting profit of £2.6bn (FY2021: £1.7bn) and a combined ratio of 91.9% – a 1.6 percentage point improvement and the strongest result since 2015. In a year that saw major losses contribute 12.7% to the combined ratio – including substantial claims from the conflict in Ukraine and Hurricane Ian in the US – Lloyd’s paid out over £21bn to customers.
The attritional loss ratio improved again to 48.4% (FY2021: 48.9%) while the expense ratio improved by 1.1 percentage points to 34.4% (FY 2021: 35.5%), reflecting efforts to deliver strong performance and reduce the cost of doing business at Lloyd’s. With prices increasing by 8%, the Lloyd’s market has now seen 20 consecutive quarters of positive price improvement.
Mark-to-market accounting rules on fixed income investments led to an overall loss of £0.8bn, however this loss is expected to reverse in the coming years as assets reach maturity and benefit from favourable interest rates.
Lloyd’s capital and solvency position continues to strengthen, with a central solvency and market-wide solvency ratio of 412% and 181% respectively (2021: 388% and 177%). Net resources stood at £40.2bn despite the investment loss, demonstrating the exceptional strength and resilience of Lloyd’s balance sheet.
John Neal, CEO of Lloyd’s said: “This is an outstanding underwriting result that follows several years of performance improvement, a comprehensive plan to digitalise our market, steady and sustained progress on our culture and purposeful action to help our industry and society manage the biggest challenges of our time.
“Looking to 2023, Lloyd’s expects strong premium growth to around £56bn, a combined ratio below 95% and a total investment performance on our assets of more than 3% – enabling us to support customers through the uncertain times ahead.”
The key figures reported in Lloyd’s 2022 full year results are:
- Gross written premiums of £46.7bn (2021: £39.2bn)
- Underwriting profit of £2.6bn (2021: profit of £1.7bn)
- Combined ratio of 91.9% (2021: 93.5%)
- Loss before tax of £0.8bn (2021: £2.3bn profit)
- Attritional loss ratio of 48.4% (2021: 48.9%)
- Net investment loss of £3.1bn (2021: £0.9bn profit)
- Net resources of £40.2bn (2021: £36.6bn)
- Central solvency ratio of 412% (2021: 388%)
- Market-wide solvency ratio of 181% (2021: 177%)
Notes to editors
Notes to editors:
- For further detail on any forward-looking statements please refer to the 2022 Full Year Results.
- A combined ratio is a measure of an insurer’s underwriting profitability based on the ratio of net incurred claims plus net operating expenses to net earned premiums. A combined ratio of 100% is break even (before taking into account investment returns). A ratio less than 100% is an underwriting profit.
- Lloyd’s strong financial strength ratings are A+ (Strong) stable outlook with Standard & Poor’s, A (Excellent) stable outlook with A.M. Best, AA- (Very Strong) with Fitch Ratings and AA- (Very Strong) with Kroll Bond Rating Agency.
- Members’ resources operate on a several basis and are only available to meet each member’s share of claims. Central assets are available at the Council’s discretion to meet the liabilities of any member on a mutual basis.
- Foreign exchange rates may materially fluctuate from the rates prevailing at 31 December 2022 (£1 = US$1.20, £1 = €1.13). Premiums, claims and investment income are translated at the average exchange rate for the period to 31 December 2022 (£1 = US$1.24, £1 = €1.17)
- More news and information available from lloyds.com
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