Lloyd’s of London remains in red after ‘costly’ year of natural disasters
The insurance market reported annual losses of £1 billion for 2018 after a £2 billion deficit the previous year.
Insurance market Lloyd’s of London has reported its second year in a row of annual losses after claims hit £19.7 billion following a raft of natural disasters including the devastating Californian wildfires.
The group reported annual losses of £1 billion for 2018 after a £2 billion deficit the previous year as it bemoaned “another costly year for natural catastrophes”.
Lloyd’s of London said the bill for major claims alone cost the market £2.9 billion, including for hurricanes Florence and Michael, Typhoon Jebi in Japan and the US wildfires.
This compared with £4.6 billion in 2017.
But the group said annual results showed “green shoots of improvement”, with prices strengthening by 3.2% on renewal business.
The results come after Lloyds on Tuesday pledged to bring in a raft of new measures in response to reports of a pervasive culture of sexual harassment at the insurance market.
Its plan of action includes an independent route for reporting inappropriate behaviour, a market-wide survey on the issue and new training.
We have implemented stronger performance management measures which will remain an enduring feature of how we go about our business Chief executive John Neal
On announcing the 2018 losses, Lloyd’s chief executive John Neal said: “This performance is not of the standard that we would expect of a market that has both the heritage and quality of Lloyd’s.
“We have implemented stronger performance management measures which will remain an enduring feature of how we go about our business.
“We expect these actions to deliver progressive performance improvement across the market beginning in 2019 and in the years to come.”
He added: “We are determined to show decisive leadership across three fronts – to address the performance gap, to secure Lloyd’s future success and, following our announcement yesterday, to tackle all forms of inappropriate behaviour with robust actions to create a more inclusive working environment.”
The group’s plans to tackle claims of sexual harassment come after women working at the London market told Bloomberg they had experienced harassment ranging from inappropriate comments to unwanted touching.
Lloyd’s chairman Bruce Carnegie-Brown told the BBC’s Today programme the group was not aware of the scale of the issue until the Bloomberg report.
He said: “We really didn’t know the extent of the problem until Bloomberg shone a light on it.
“We’ve actually had a number of initiatives over the last few years trying to make the market more diverse and inclusive, but we hadn’t got to the root of the issue.”
As part of the new measures, an independent and confidential access point will be provided for reporting inappropriate behaviour.
Individuals found to have acted inappropriately will be subject to sanctions from both their own companies and Lloyd’s, including a possible temporary or permanent ban from entering Lloyd’s.
The market has not ruled out further action, saying this will be informed by an independent survey to identify the scale of the problem.