Lloyd's of London will pay £2.4 billion in pandemic-related claims for the first six months, the commercial insurance market said today as it recorded a first-half loss.
Lloyd's said its total loss due to Covid-19 claims was likely to be around £3 billion.
Insurers around the world have paid out on event cancellation, travel, trade credit and business interruption policies due to the virus, with Lloyd's expecting the global bill for non-life insurers to reach more than $100 billion this year.
Losses due to the pandemic could stretch into future years, Chairman Bruce Carnegie-Brown told Reuters.
"Nobody knows when it started, we certainly don't know when it's going to end," he said.
Lloyd's, whose results are an aggregate of its more than 90 syndicate members, said the Covid-19-related payments were net of reinsurance.
The market posted a first-half pre-tax loss of £438m compared with a £2.3 billion profit a year earlier.
Gross written premiums rose 1.7% to £20 billion.
Its combined ratio, a measure of underwriting profitability, deteriorated to 110.4% from 98.8% a year earlier. A level above 100% indicates an underwriting loss.
Excluding Covid-19 claims, however, its combined ratio strengthened to 91.7%.
Lloyd's has required its members to ditch their worst-performing lines of business in recent years, and some have exited the market.
Carnegie-Brown said marine and aviation were among loss-making lines of business, and he expected more syndicates to leave Lloyd's, adding that the market also had a "strong pipeline of new applicants".
Lloyd's reopened its underwriting floor last week after nearly six months of closure due to the pandemic.
The floor can operate at up to 45% of its former capacity. Carnegie-Brown said so far the numbers going in each day were in the hundreds rather than the thousands previously.