Lloyd's of London sees global pandemic insurance losses above previous estimate

By Noor Zainab Hussain and Carolyn Cohn (Reuters) - Global insurance losses from the COVID-19 pandemic will be higher this year than the $107 billion Lloyd's of London had previously estimated, its Chairman Bruce Carnegie-Brown said on Wednesday. Carnegie-Brown told the Reuters Events Future of Insurance USA conference that pandemic-induced losses will be on a par with 2017, when three Atlantic hurricanes contributed to a catastrophe bill of $144 billion, the highest on record according to Swiss Re.

Reuters November 19, 2020 01:05:50 IST
Lloyd's of London sees global pandemic insurance losses above previous estimate

Lloyds of London sees global pandemic insurance losses above previous estimate

By Noor Zainab Hussain and Carolyn Cohn

(Reuters) - Global insurance losses from the COVID-19 pandemic will be higher this year than the $107 billion Lloyd's of London had previously estimated, its Chairman Bruce Carnegie-Brown said on Wednesday.

Carnegie-Brown told the Reuters Events Future of Insurance USA conference that pandemic-induced losses will be on a par with 2017, when three Atlantic hurricanes contributed to a catastrophe bill of $144 billion, the highest on record according to Swiss Re.

Lloyd's, which in March shut its underwriting room for the first time since World War II due to a UK government lockdown, said Lloyd's firms were facing claims from 16 different business lines.

"Unlike many events, a pandemic is everywhere at the same time," Carnegie-Brown said, adding that the outbreak had extended longer than expected.

The 330-year-old Lloyd's operates a commercial insurance marketplace, insuring anything from oil rigs to footballers' legs. It has said it will pay 2.4 billion pounds ($3.2 billion) in pandemic-related claims for the first six months of 2020.

Lloyd's has proposed a "Black Swan" reinsurance scheme to governments globally to ensure better cover during circumstances such as the pandemic and other disturbances to business, but Carnegie-Brown said it was hard to get government attention on the topic so far.

"The challenge for governments of course is that they are very short-term focused... (it is) very difficult for them to lift their heads above the parapet and think about the future," Carnegie-Brown said.

Cyber exposure remained the biggest risk faced by insurers, he added, echoing comments made earlier this week by insurance broker and consulting firm Marsh & McLennan.

"As a world, we need to look at our resilience to cyber risk exposures."

($1 = 0.7517 pounds)

(Reporting by Noor Zainab Hussain in Bengaluru; Editing by Carolyn Cohn in London and Jan Harvey)

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