At a time of prolonged economic gloom, even the predictable but positive is warmly welcomed.
It’s in that context that the reaffirmation of Lloyd’s A.M. Best rating of A (Excellent) is received.
The rating comes after Lloyd’s recent solid 2008 performance, which is mentioned by A.M. Best, and a reiteration of confidence in a strong market focused on strategic, long term intent, such as underwriting discipline and managing the cycle.
Luke Savage, Lloyd’s Finance Director, said: “We are very pleased that A.M. Best has reaffirmed our ratings and focused on our strong performance in difficult times. We have always known the attractiveness of our capital-efficient structure and our global licences are strengths for Lloyd’s; and we are pleased these have received special mentions."
A.M. Best’s assessment
The rating agency’s reasons for reaffirming Lloyd’s ratings are robust, citing the following points:
Lloyd’s will maintain a solid and flexible capital base through 2009 and into 2010, with central solvency also expected to remain strong
The potential of future draw downs on the Central Fund is expected to diminish given a reduction in run-off liabilities, increased oversight of syndicates and the completion of the Equitas deal
Lloyd’s attractiveness continues to grow due to its efficient capital structure, access to global licences and as insurers seek to diversity their risk
Tomorrow’s climate for business and Lloyd’s
For the future, A.M. Best envisages a market that will continue to expand globally and compete on a global scale. The agency says:
“Lloyd’s has an excellent business profile, particularly in the U.S. and London market, and continues to expand its global reach through extension of its licence network and local trading platforms. The collective size of the market and its unique capital structure enable syndicates to compete effectively with major international insurance groups under the Lloyd’s brand.”
