Will Lloyds Insurance losses hit premium rates?
News that Lloyds of London, the central insurance market for the worldwide industry, is set to report substantially reduced profits has put consumer groups and the industry as a whole on red alert. There are concerns that the rising cost of claims from recent hurricanes in the US to burst gas pipelines in Australasia will see claims and losses increase dramatically over the next 12 months. Will we see premiums increase to make up any shortfall?
As with any time in the past when insurance claims have increased and payouts ballooned, it will be the consumer who pays the price. While it may take a while to confirm the losses from the recent events - it has taken up to a decade for some losses to be quantified in the past - the financial strength of Lloyds of London is vital. It this requires a general increase in insurance premiums across the board then this will happen in a bid to replenish reserves.
When you consider that hurricane Ike alone caused up to £15 billion of damage it is not difficult to see how the profitability level of Lloyds of London can change overnight. It will be interesting to see if this threat to the profitability of the oldest insurance market in the world has any immediate impact on premiums.
Share this..
Related stories
Unpaid overtime totals £27.4 billion in 2009
In a reflection of how difficult a year 2009 was for the UK economy, it has been revealed that a massive £27.4 billion was worked in unpaid overtime by UK employees. This equates to a record £5,400 per worker in the UK and is the largest figure since these records began. While many people would expect to "do a little extra" to secure their jobs in these difficult economic times the amount of wor...
Read MoreBookmakers set to prosper in difficult times
While we have seen the banking sector under severe pressure, retailers on the high street cutting back on costs and many sportswear companies feeling the pinch, is there really anywhere in UK economy which is safe?
While not to say that the bookmaking sector has not been impacted by the downturn, it appears that more and more UK gamblers are enjoying a flutter even in these difficul...
Childcare costs rose by 19% last year, says parenting website
13/01/2014 The cost of having your child cared for while you work rose by 19% year-on-year to December 2013, according to parenting website, findababysitter.com. The figure, which is derived from data collected from a pool of 231,000 nannies, childminders and other professionals, highlights the extent to which parents are being put under increasing financial pressure. Childcare prices have...
Read MoreUnemployment down, Despite Recession
Unemployment within the UK has fallen in the past quarter, down to a low of 8pc, possibly due to increased hiring associated with the Olympic Games. Official figures from the Office of National Statistics confirmed that some 46,000 people more than the previous three month period were employed; meaning the overall previous rate of 8.2pc was reduced to 8pc. This has come as a surprise to many, i...
Read MoreHow will further union conflict affect British Airways?
As the friction between British Airways and Unite union continues to grow there are real fears about the future of British Airways with the company coming under more and more financial pressure. Despite the fact there appeared to be a breakthrough in talks between the two parties a while back it seemed as though they are now further apart than ever before with the union now calling for the reinsta...
Read More