LLOYD’S ATTRITIONAL LOSSES UNDERMINE PERFORMANCE: KROLL

The outlook for the Lloyd's market could deteriorate amid unfavourable underlying underwriting performance, Kroll Bond Rating Agency Europe has warned. The rating agency, which recently assigned the corporation a AA- rating and a stable outlook, cited elevated attritional losses since 2017 and major catastrophe events as drivers of most of Lloyd’s underwriting losses. Data from Kroll showed an attritional combined ratio of around 88% for Lloyd’s compared with a peer mean of around 99% in 2020. Lloyd’s has attempted to reverse this trend by reducing exposures to unprofitable classes or increasing rates but even though last year attritional losses moved in line with targets, “a longer underlying trend over the medium term is needed to support a return to sustained underwriting profitability”, Kroll said.