Lloyd’s Reports Improved Combined Ratio on H1 Underwriting Profit of £1.9B
Lloyd’s of London reported an improved first-half combined ratio of 90.8%, (H1 2025: 92.5%), which drove an underwriting profit of £1.9 billion (US$2.6 billion), compared with £1.5 billion (US$2.0 billion) in H1 2025.
The major claims ratio improved to 6.8% during the first half (H1 2025: 10.4%), reflecting a comparatively lower level of catastrophe losses in the first half of this year.
The underlying combined ratio of 84.0% (H1 2025: 82.1%) increased slightly, corresponding with the reduction in risk-adjusted rates, Lloyd’s said. (A combined ratio below 100 indicates an underwriting profit).
Profit before tax decreased by 16.8% during H1 2026 to £3.5 billion ($4.7 billion) from £4.2 billion ($5.7 billion) during the same period last year. The market also reported lower investment returns of £1.8 billion ($2.4 billion) — compared with £3.2 billion in H1 2025 — affected by unrealized fixed income losses following a widening of yields in the period.
“The syndicates operating in the Lloyd’s market delivered a solid aggregate set of results for the six months ended June 30, 2026,” according to Lloyd’s Chief Executive Patrick Tiernan, in a statement. “But performance and high risk are far from mutually exclusive. Underwriting discipline and innovation are the keys to maintaining outperformance and quality of earnings.”
Gross written premium during the first half increased by 6.9% to £34.7 billion ($46.8 billion), driven by growth from new and existing syndicates, despite the more competitive pricing environment.
Lloyd’s explained that this growth was offset by adverse foreign exchange movements of (2.2)%, level with H1 2025, as sterling strengthened against the US dollar, and by a market-wide price reduction of 6.7%, compared with a decline of 3.5% in H1 2025, consistent with a more competitive pricing environment.
In a market statement issued with the half-year results, Tiernan commented on the reduction in rates seen during the first half: “While our assessment of long-term rate adequacy remains above the level required to deliver a 95% net combined ratio, the continuing erosion of adequacy in core markets comes as an array of risk signals are flashing more urgently.”
He went on to say: “As the underwriting conditions become more challenging, we should not expect growth in core markets. Our priority must be to protect underwriting quality and sustainable returns.”
Tiernan said the market’s outlook for the full year remains unchanged. “We continue to expect gross written premium of £64 billion (plus or minus 5%) and a combined ratio of between 90% and 95%.”
Related: