Lloyd's of London boasts 'resilience', warns of pricing challenges
By Josh White
Date: Thursday 04 Sep 2025
(Sharecast News) - Lloyd's of London reported a first-half of "resilience" on Thursday, with solid investment gains helping offset a weaker underwriting performance following heavy catastrophe losses.
Gross written premiums rose 6.2% year-on-year to £32.5bn, supported by volume growth of nearly 12% from new and existing syndicates.
The increase was partly offset by adverse currency movements and a 3.5% decline in average pricing across the market.
Its underwriting result fell to £1.5bn from £3.1bn a year earlier, as the combined ratio deteriorated to 92.5% from 83.7%.
Lloyd's said the increase was largely due to major claims from the California wildfires, which accounted for 10.4% of the ratio, compared with 3.1% in the same period last year.
Excluding those, the underlying combined ratio was 82.1%, broadly in line with expectations.
Profit before tax declined to £4.2bn from £4.9bn, though investment returns provided a boost, climbing to £3.2bn from £2.1bn.
Lloyd's said the result reflected "strong income and realised gains, supported by higher reinvestment yields and a favourable rate environment," with fixed income markets rebounding across major asset classes.
The market maintained a strong capital position, with total capital and reserves at £43.8bn and a central solvency coverage ratio rising to 468%, from 435% at the end of 2024.
The market-wide solvency ratio edged up to 206%.
Chief executive Patrick Tiernan said the results demonstrated "strength and resilience" despite the return of major claims.
"Disciplined underwriting ensured the underlying result had the capacity to absorb such volatility," he said.
"Investment performance was strong, and the market's capital position and solvency ratios provide a very good foundation for future growth."
Looking ahead, Lloyd's cautioned that pricing conditions were becoming more challenging, with heightened uncertainty across the industry.
The market was working on a refreshed strategy due by March next year, which Lloyd's said would focus on sustainable returns, disciplined execution and reduced costs.
Tiernan said Lloyd's continued to "innovate and expand the global reach of the Lloyd's platform" and remained committed to securing "sustainable and attractive returns on capital through the economic cycle."
Reporting by Josh White for Sharecast.com.
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