Lloyd's of London expects £5bn in Covid-19 insurance payouts


Lloyd’s of London, the world’s biggest insurance market, said it expected up to £5bn would be paid out in claims related to the coronavirus pandemic .

The insurers that operate in the Lloyd’s market are paying out Covid-19 claims in 16 different insurance areas, mostly related to event cancellations but also medical malpractice, travel cancellations and business interruption.

John Neal, the chief executive of Lloyd’s of London, said the first half of the year had been exceptionally challenging.

“The pandemic has inflicted catastrophic societal and economic damage calling for unparalleled measures to stifle the spread of the virus, and to get businesses and economies back on their feet,” he said.

Lloyd’s said claims related to the pandemic totalled £2.4bn in the first six months of 2020, after reinsurance recoveries, leading to a £400m loss for the period. This compared with a £2.3bn profit in the first half of 2019.

Insurance premiums had already started to rise before the pandemic, after a period of falling prices, and increased by 8.7% in the first half. The trend is likely to continue, said Bruce Carnegie-Brown, the chairman of Lloyd’s.

He returned the Lloyd’s building in London three weeks ago. Hundreds of brokers and underwriters have also come back to work in the underwriting room, which reopened on 1 September after being closed since March.

The 334-year-old institution has installed perspex screens between the insurance syndicates’ boxes and introduced regular “fogging” to kill viruses and bacteria. Before the pandemic, it hosted about 6,000 of its 45,000 workers on any given day.

READ  Insurers seek comfort in catastrophe bonds
Sign up to the daily Business Today email or follow Guardian Business on Twitter at @BusinessDesk

Lloyd’s has come under renewed pressure from the climate campaign group Insurer Our Future to pull entirely out of coal and tar sands insurance and investments. Lloyd’s has eliminated thermal coal investments from its own investment portfolio, but has not extended this to guidance to the 90-plus syndicates that make up the market.

Carnegie-Brown said Lloyd’s was working on an environmental, social, and corporate governance report, which will be published before the end of the year. He added that decisions would be then made based on that report. “We may get there,” he said. “We want to look at the facts.”

In October, Lloyd’s will carry out its second annual survey of harassment and bullying in the market and publish the results in November. Last year it found that nearly 500 people working in the market had either suffered or observed sexual harassment in the previous 12 months. It set up a bullying and harassment helpline after Bloomberg reported evidence from 18 women that suggested sexual harassment was rife in the market.



READ SOURCE

LEAVE A REPLY

Please enter your comment!
Please enter your name here