Since the 17th century, Lloyd’s of London has been recognized as a trusted carrier for specialized insurance. Lloyd’s began in a coffee house in 1688, and has spent the last 330 years offering insurance coverage for both common and unusual risks all around the world. Recent events in the market – catastrophic natural disasters that have led to over $2 billion in losses for the specialist insurance carrier and recent news that Lloyd’s CEO, Inga Beale, will be stepping down in 2019 – have led the company to review all aspects of business in order to return to profitability as soon as possible.
The 2017 natural catastrophes that pushed Lloyd’s to an over $2 billion net loss also left the company with a combined ratio (the sum of the insurer’s loss ratio and expense ratio) of 114 percent, indicating an underwriting loss and prompting Lloyd’s to take action to improve their underwriting performance. Although Lloyd’s notes that its expense ratio is often higher than its peer group, an increase in their loss ratio is to blame for the recent troubles after increasing to 58.9% in 2017. Their expense ratio improved – just slightly – by 1.1 points, though still leaving them with the highest expense ratio in their peer group.
Lloyd’s of London’s unique structure has also gone under the microscope as executives seek to ensure that Lloyd’s remains as cost-competitive and responsive to clients and members as they have been since their beginnings. Some of the cost-cutting efforts on the part of Lloyd’s include: encouraging members and subsidiaries to increase rates and increase the proportion of business they process electronically by at least 30 percent for the remainder of the year and shutting some syndicates down as well.
Wilmington Insurance Agency, as an authorized syndicate of Lloyd’s of London, remains at an advantage, despite the changes and marketplace increases. Wilmington has a 7.1 binder with the insurer, allowing them to offer current pricing through 7/1/2019 while other syndicates with more recent renewal binders will take price increases..
About Wilmington Insurance Agency
Wilmington Insurance Agency delivers comprehensive coastal property solutions. We are a Managing General Agency and provide independent insurance agents with property and liability insurance solutions for residents and businesses primarily in Maryland and Virginia. We work alongside our sister company, Wilmington Insurance Company, established in 1996 and providing Property & Casualty commercial lines business, homeowners, and condominium insurance in the state of Delaware. To learn more about how we can help you to expand your book of business in the coastal market, contact us at (302) 231-2800.