The insurance market of Lloyd’s of London LOL.UL has reported that it experienced its second largest losses in 2011, following the absorption of record breaking claim costs resulting from the natural catastrophes that included the earthquake and tsunami in Japan, as well as the flooding in Thailand.
This statement was made on March 28, as it compared its last year’s loss of £516 million with the profit that it made in 2010, of £2.2 billion. The reported loss included the combined financial performance of the eighty insurance syndicate competitors which comprise the market at Lloyd’s of London, was the second highest in the history of the company. The largest was the loss of £3.11 billion that occurred after the attacks on September 11, 2001.
Chief executive of Lloyd’s of London, Richard Ward, released a statement that said that “Make no mistake, 2011 was a difficult year for the insurance industry” and that “Given the scale of the claims, a loss is unsurprising.”
In 2011, Lloyds of London saw claims relating to natural disasters that totaled approximately £4.6 billion. This was the highest in the history of the market, as it brought the total payouts last year to a staggering £12.9 billion.
In terms of catastrophes, last year was the second most costly in the entire insurance industry. According to the second largest reinsurer in the world, Swiss Re, the tornadoes, floods, earthquakes, and other devastating natural events brought in a claims total of $116 billion. Only Hurricane Katrina’s $123 billion in claims in 2005 surpassed that total.