This year, Lloyd's of London will face significant claims relating to Russia's invasion of Ukraine, but the commercial insurance market leader indicated on Thursday that this will not result in insolvency concerns.
Chairman Bruce Carnegie-Brown told Reuters that Lloyd's is asking its member syndicates to describe their exposure to the war, but that it is too early to assess the extent of the damage.
Around 100 Lloyd's members insure sophisticated risks such as planes, ships, and oil rigs.
The aviation insurance industry is thought to be particularly vulnerable to the consequences of what Russia has termed as a "special military operation" and the accompanying sanctions imposed by the West.
For the seizure of more than 400 jets worth around $10 billion from Russian airlines, global leasing businesses face an impending sanctions deadline.
Legal fighting between airlines, lessors, and insurers, according to analysts, might last a decade.
According to Lloyd's, business underwritten in Ukraine, Russia, and Belarus accounted for less than 1 per cent of the entire business underwritten in the market.
"In terms of our direct exposures, they're quite low. So this is much more about second order impacts, of which aviation will clearly be one and will end up being significant," Carnegie-Brown said.
According to him, some insurance policies kick in as a result of a war, while others do not, making exposures difficult to assess. He said that policyholders had notified insurers of potential claims but have yet to file them.
In 2020, the COVID-19 pandemic wreaked havoc on Lloyd's, but the market bounced back last year after raising premium rates and excluding the virus from coverage.
Following a 900 million-pound loss in 2020, it made a pre-tax profit of 2.3 billion pounds ($3.04 billion) in 2021.
"The market’s underwriting discipline will enable sustainable profitability in the years to come, coupled with a balance sheet that can support our ambition to grow profitably," Chief Executive John Neal said in a statement.
(Source:www.marketwatch.com)
Chairman Bruce Carnegie-Brown told Reuters that Lloyd's is asking its member syndicates to describe their exposure to the war, but that it is too early to assess the extent of the damage.
Around 100 Lloyd's members insure sophisticated risks such as planes, ships, and oil rigs.
The aviation insurance industry is thought to be particularly vulnerable to the consequences of what Russia has termed as a "special military operation" and the accompanying sanctions imposed by the West.
For the seizure of more than 400 jets worth around $10 billion from Russian airlines, global leasing businesses face an impending sanctions deadline.
Legal fighting between airlines, lessors, and insurers, according to analysts, might last a decade.
According to Lloyd's, business underwritten in Ukraine, Russia, and Belarus accounted for less than 1 per cent of the entire business underwritten in the market.
"In terms of our direct exposures, they're quite low. So this is much more about second order impacts, of which aviation will clearly be one and will end up being significant," Carnegie-Brown said.
According to him, some insurance policies kick in as a result of a war, while others do not, making exposures difficult to assess. He said that policyholders had notified insurers of potential claims but have yet to file them.
In 2020, the COVID-19 pandemic wreaked havoc on Lloyd's, but the market bounced back last year after raising premium rates and excluding the virus from coverage.
Following a 900 million-pound loss in 2020, it made a pre-tax profit of 2.3 billion pounds ($3.04 billion) in 2021.
"The market’s underwriting discipline will enable sustainable profitability in the years to come, coupled with a balance sheet that can support our ambition to grow profitably," Chief Executive John Neal said in a statement.
(Source:www.marketwatch.com)
