Lloyd’s has today released aggregate results for the market for the year that ended 31 December 2020. As widely anticipated, these results show a loss, a large part of which is attributed to the losses incurred by the market in consequence of claims arising out of Covid-19.

The headline numbers are as follows:





Gross written premium




Net earned premium




Net claims and operating expenses




Underwriting result




Net investment income




Profit/(Loss) before tax








Loss ratio



9.7 points worse

Expense ratio



1.5 points better

Combined ratio



8.2 points worse

Loss ratio excluding covid-19 losses




Combined ratio excluding covid-19 losses




The estimated loss arising out of the pandemic has increased from £5 billion to £6 billion, with the length of restrictions on movement in many nations and some adverse legal verdicts playing their part. Net of reinsurance, covid claims account for £3.6 billion of claims. The gross loss is distributed by line of business as follows:

Accident & Health (contingency)


Property insurance


Property reinsurance


Political risk, credit and financial guarantee


Accident & Health (other)






The market has paid claims of £1,200m to the end of the year, with reported outstanding claims standing at £800m. The largest element of the loss is therefore the provision for incurred but not reported losses which totals £4,100m. Lloyd’s annual accounting does not make reference to the years of account impacted, although data we have received from syndicates shows that the loss is allocated 14% to the 2018 year, 58% to 2019 and 28% to the 2020 underwriting year.

Lloyd’s is able to point to a number of positive underlying trends when the impact of Covid is stripped out. These include the rate increases over the past three years, with the market reporting thirteen consecutive quarters of rate improvement across all lines of business. Lloyd’s data shows average rate increases of 10.8% in 2020 (many syndicates argue that Lloyd’s metrics are conservative and that their own data shows better increases over the year) while the market continues to report double digit improvement in 2021. Remediation of underperforming books of business removed 12% of income in 2020, which was made up largely by rate improvement on renewal business. Burkhard Keese, Lloyd’s Chief Financial Officer, said that the ongoing book is of better underlying quality at better rate levels. The underlying attritional loss ratio (run of the mill losses before major catastrophe losses such as hurricanes, tsunamis , earthquakes and (in 2020) pandemics has improved by more than 7 percentage points to 52%. In 2020, Lloyd’s also was impacted by natural catastrophes other than Covid-19 that added an aggregate of £2,100 million to the total claims costs. These included hurricanes Sally and Laura and a derecho, an electric storm, in Iowa.

The complete preliminary results statement is available here and the analysts’ slide pack is available here.

We will be writing to clients with further analysis and opinion before Easter.

Lloyd’s has also released results and updated forecasts for syndicates 2018 and 2019 years of account. These show that individual members of Lloyd’s have once again outperformed market average, with the market declaring an overall loss of 5.9% of capacity for the 2018 year, compared to the average loss for an Argenta client of 2.3% of capacity. The forecast for the 2019 has deteriorated at market level to a midpoint loss of 5.2% of capacity compared to an Argenta client average midpoint loss of 3% of capacity. A schedule of all results and forecasts including the Lloyd’s averages is available here. Updated forecasts for the 2019 year of account and initial forecasts for the 2020 year of account will be released by Lloyd’s on 12 May 2021.