Lloyd’s of London allocates $1.3 billion for lawsuits against Ukraine

Lloyd’s of London has set aside £1.1bn ($1.26bn) to pay war-related claims in Ukraine, the commercial insurance market said Thursday, posting a pre-tax loss of £1.8bn in the first half of the year.

Provisions for claims in Ukraine were net of reinsurance, Lloyd’s said in a statement. Insurers buy reinsurance to remove some of the risk of large losses.

“We assessed the financial implications very quickly,” Lloyd CEO John Neal told Reuters by phone. catastrophe”.

According to Neal, about a quarter of Lloyd’s losses in Ukraine could be related to the aviation market.

Landlords and aviation insurers are arguing over planes stranded in Russia due to what Russia calls a “special military operation” invasion of Ukraine and subsequent Western sanctions.

Neil added that insurers around the world could face between $10 billion and $15 billion in claims as a result of the conflict.

About 100 syndicates trade at Lloyd’s, which specializes in specialized risks ranging from oil rigs to football feet.

Lloyd’s has asked its members to stop insuring new thermal coal mines as it aims to achieve zero environmental targets.

But Neil said the current energy crisis means there could be flexibility on how to achieve those goals.

“Let’s say there are difficult energy decisions to be made next week – if they are made in the broader context of net zero…then I think we could be open-minded and ready for a conversation that could be about thermal coal.”

Lloyd’s this week told employees earning less than £75,000 a year that they would receive a lump sum of £2,500 in September, Neal said, following other UK firms in offering a living wage to employees.

Lloyd’s said it suffered losses as interest rates hit its investment after a £1.4bn profit a year ago.

However, its underwriting profit jumped 25% to £1.2bn. In recent years, higher premium rates have helped insurers profit from underwriting.

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