29 Mar 2012

Christchurch quake contributes to big loss for Lloyd's

6:56 am on 29 March 2012

The February earthquake in Christchurch is being cited as one of the natural catastrophe claims that contributed to a big loss for Lloyd's of London last year.

Lloyd's - a society of corporate underwriters and wealthy individuals that make insurance transactions - said it lost £516 million on net claims of £12.9 billion.

The claims included £4.6 billion for catastrophes - the largest amount in that category in Lloyd's 324-year history - while 2011 proved to be the second-costliest year ever in terms of natural catastrophe claims for the global insurance industry with claims totalling $US107 billion.

Lloyds of London has not seen losses like this since the terror attacks on New York in 2001. Its syndicate risk-taking brokers stil managed to meet all their liabilities without dipping into reserves, the BBC reports.

Other major catastrophe claims followed flooding in Australia in January, the Japanese earthquake and tsunami in March, a deadly series of tornadoes in the United States in April and May, and floods in Thailand from July.

Higher premiums are being signalled for policyholders. Lloyds says while it remains in a strong financial position, it is disappointed that insurance rates generally have not been rising as much all round as it would like.

Lloyd's of London chairman John Nelson warned that 2012 would be another challenging year.