Standard and Poor has recently reaffirmed Lloyd’s A+ rating with a stable outlook in the insurance market. However, there are many challenges ahead and S&P cautions that industry trends of continuing rating pressure, catastrophe losses and lower investment returns will test the market’s operating performance over the coming years.
It is S&P’s opinion that Lloyd’s is expected to bear a large share of claims from the Chilean earthquake as well as being impacted by losses arising from the Deepwater Horizon oilrig disaster.
Lloyd’s also faces challenges from the new Solvency II capital rules due to be introduced in Europe in 2013, S&P states, although it also notes Lloyd’s is working hard to develop its own internal capital model that would significantly lower the market’s capital requirements than if it were to use the standard formula.
The rating agency concluded that, “All in all, the future presents some challenges to Lloyd’s, but the market is well placed to deal with them.”
Please note Quotesonline Insurance News is an information service provided by third parties Insure 247 Australia doesn’t warrants the accuracy of any information contained there in, readers should make their own enquiry’s before relying on information in the stories Terms of Service