09/09/2021 | Press release | Distributed by Public on 09/09/2021 00:29
Gross written premiums increased to £20.5bn (HY 2020: £20.0bn) due to an increase in premium rates, high customer retention and new growth for the first time in four years.
Premium rates increased by 9.9%, continuing the trend of 15 consecutive quarters of positive rate movement.
The combined ratio of 92.2% (HY 2020: 110.4% and 97.0% excluding COVID-19 claims) is a solid improvement with a 4.8 percentage point reduction on the previous year, excluding COVID-19. These results demonstrate the substantial turnaround of Lloyd's profitability and performance.
Lloyd's continued to provide significant support to its customers around the world, paying £9.4bn of claims, including to customers impacted by COVID-19 where 80% of the claims notified to date have been paid.
Improvements to the combined ratio have been driven by notable reductions to both the attritional loss ratio and the expense ratio. The attritional loss ratio of 50.5% (HY 2020: 52.6%), is a 2.1 percentage point reduction from the ratio reported for the first six months of 2020. The expense ratio of 35.8% (HY 2020: 37.7%) is a 1.9 percentage point improvement, and 3.7 percentage points improvement since 2017. The reduction in operating expenses remains a focus of Lloyd's digital transformation programme.
Lloyd's maintains strong capital and solvency positions, with net resources increasing by £2.6bn to £36.5bn, reinforcing the exceptional strength of Lloyd's balance sheet with central solvency and market solvency ratios of 218% and 170% respectively (FY: 2020 209% and 147%).
John Neal, Lloyd's CEO, said: 'In an uncertain world Lloyd's remains acutely focused on supporting our customers when they need us, and in the first half of 2021 we have paid out nearly £10bn in claims to help the recovery of businesses and economies globally.
'Against this backdrop, Lloyd's has successfully repositioned the market for sustainable, profitable growth as evidenced in this strong set of financial results. I am encouraged to see that market performance has improved as a result of our ongoing remediation efforts. This, as well as our exceptionally strong balance sheet, brings Lloyd's performance in line with our global peer group.
'Alongside performance, we are making great strides on all our strategic priorities which focus on improving the culture in the market, the Future at Lloyd's digital transformation, and sustainability, climate and inclusion which underpin our purpose.'
The key figures reported in Lloyd's 2021 Half Year Results are: