The invasion of Ukraine presents Lloyd’s of London with potential major claims this year. Around 100 members of Lloyd’s underwrite complex risks, including planes, ships, and oil rigs. According to this article by BusinessInsurance.com, the aviation insurance market is considerably exposed to the situation in Ukraine. Chairman Bruce Carnegie-Brown told Reuters that it was too soon to estimate the size of the loss.
Lloyd’s has stated that business in Ukraine, Russia, and Belarus accounted for less than 1% of the market’s total business. Mr. Carnegie-Brown believes the direct exposure is relatively low. Some insurance policies kick in as a result of war. Some policies do not cover war. The different types of policies can make the exposure hard to estimate. He also added that policyholders have notified insurers of likely claims but have yet to file them.
Lloyd’s was already hit hard in 2020 due to the COVID-19 pandemic. The market has recovered. The firm posted a 2021 pre-tax profit of $3.04 billion, following a roughly $1 billion loss in 2020. The firm believes in the underwriting discipline it maintains to continue growth in 2022, even in uncertain times.
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