Better weather boosts Lloyd's

THE Lloyd's of London insurance market has seen profits more than double, reaching a record level thanks to a quiet hurricane season and better returns on its investments.

The market, which traces its origins back 322 years to a London coffee house where wealthy merchants sold shipping insurance, said its 2009 pre-tax profit was almost 3.9 billion, up from 1.9bn in 2008, when it had to pay out large sums in the wake of hurricanes Ike and Gustav.

Reduced claims expenses pushed Lloyd's 2009 combined ratio – a key measure of profitability which expresses claims and costs as a proportion of premium income – to 86 per cent from 91 per cent the previous year.

A combined ratio below the 100 per cent break-even point denotes an underwriting profit. The market also benefited last year from rebounding financial markets.