The Lloyd’s executives said the market has continued to demonstrate its value to stakeho
lders by delivering 6.5% premium growth while maintaining underwriting discipline.
Lloyd’s saw a continuation of positive returns with profit before tax of £9.6 billion ($12.4 billion)
during 2024, down from £10.7 billion ($13.8 billion) in 2023. The market achieved a combined ratio of 86.9% for full-year 2024, compared with 84.0 for FY2023. (A combined ratio below 100 indicates an underwriting profit).
Lloyd’s Chief Financial Officer Burkhard Keese said that 2024 was a year when the market once again “proved our underwriting discipline and delivered profitable gro
wth of 6.5%,” or gross written premium totaling £55.5 billion ($71.7 billion), compared with £52.1 billion ($67.3 billion) for FY 2023.
Keese and Chief Executive Officer John Neal both spoke during a recent media briefing to discuss Lloyd’s full-year results for 2024.
“Lloyd’s has been relentless in pursuing sustainable profitable performance in the market. We’ve been on a seven-year journey to deliver the change our stake
holders wanted – to consistently focus on the delivery of disciplined underwriting, to modernize our performance and oversight frameworks, to address the c
ost of doing business at Lloyd’s, and to show leadership on the issues that matter,” said Neal, who will exit the market this year to become global CEO of Aon Reinsurance and chairman of Aon’s Climate Solutions unit.
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Source: Lloyd’s 2024 results presentation
“Our track record since 2017 speaks for itself. To date, we’re reporting a combined ratio for 2024 of 86.9%. We have reduced our underlying combined ratio to 79.1
%, (which excludes major claims), or a 16 percentage point improvement on that same ratio from 2019,” Neal said, adding that Lloyd’s strong reserving position continued to support some positive prior year reserve releases, which reduced the 2024 combined ratio by 2.4%.
“The key components of the combined ratio are moving positively. Importantly, the attritional loss ratio, most directly under the underwriters’ control as they select, manage and price risk, has reduced to 47.1% and is now consistently below 50%. Operating expenses have fallen over the period from 40% [in 2017] to 34% [in 2024], with opportunities to manage this ratio further post digitalization,” Neal added.
The market’s 2024 expense ratio of 34.4 remained flat with 2023, which Keese described as “a small disappointment.”
Most Important Measure
Both Keese and Neal focused a lot of their commentary on Lloyd’s underlying combined ratio, which Keese described as “the most important measure…”
“With our underlying combined ratio of 79.1%, we have achieved our profitability threshold of 80% for the third consecutive year, proving once again how well our Lloyd’s system works,” said Keese who also is stepping down from his CFO position this year.
