By Carolyn Cohn
LONDON (Reuters) -Commercial insurance premiums may not yet be turning lower despite years of increases, Lloyd’s of London chairman Bruce Carnegie-Brown told Reuters, as the market reported a 26% jump in first-half pre-tax profit on Thursday.
Lloyd’s, which is made up of more than 50 insurance companies, underwrites specialist risks from oil rigs to professional footballers’ legs.
Commercial insurers have coped in recent years with a pandemic, wars, inflation and rising losses from natural catastrophes by excluding some business and raising prices.
Insurance prices are starting to flatten, Carnegie-Brown said.
“Some people are calling the top of the market and thinking that prices will come down,” he said, adding however that “some of the insurance companies aren’t in great shape, so I don’t know how much flexibility they have over lowering prices”.
Reinsurers, which insure the insurers, meet next week for their annual conference in Monte Carlo to hammer out pricing deals with insurers for next year. Insurers then choose whether to pass any rate changes onto their business customers.
Fitch analyst Manuel Arrive said on Thursday he expected a “moderate softening” in property catastrophe reinsurance rates at the key Jan. 1 renewal date.
Lloyd’s’ pre-tax profit rose to 4.9 billion pounds ($6.44 billion) as its members avoided riskier business.
Gross written premiums rose 6.5% to 30.6 billion pounds, while the group’s combined ratio, a measure of underwriting profitability in which a level below 100% indicates a profit, strengthened to 83.7% from 85.2% a year earlier.
($1 = 0.7614 pounds)
(Reporting by Carolyn Cohn; Editing by Jan Harvey)
