NU Online News Service, Feb. 15, 3:17 p.m. EST
Lloyd's estimates its net claims from last year's flooding in Thailand will be $2.2 billion, based on its estimate of $15 billion to $20 billion in losses for the insurance industry overall.
Lloyd's says the Thai floods are unlikely to affect its central fund or market capitalization in a material way. Lloyd's also notes its figures are preliminary and warned its losses may change as more information becomes available.
Richard Ward, chief executive of Lloyd's, stresses Lloyd's determination to settle claims quickly.
"The Lloyd's market is as well capitalized as it has ever been," Ward says in a statement. "While claims fromThailandcould still evolve over time, paying these claims is within the normal course of business for Lloyd's."
The losses could place the Thai floods in a tie for the fifth-costliest insured loss event in the past 31 years, A.M. Best Co. says in a Feb. 10 report.
It will take the industry significant time to reconcile the true impact of the floods because of a general lack of data on Thai exposures, the length and magnitude of the floods and the complexity of business interruption and contingent business interruption claims.
"As demonstrated by companies' increasing fourth-quarter reserves for catastrophe events that occurred earlier in 2011, potential losses may creep upward throughout 2012," A.M. Best says.
The Thai floods damaged more than 14,800 industrial and manufacturing plants in 20 provinces, with most of the operations owned by global manufacturing companies. Automobile and computer manufacturing were the two hardest-hit sectors.
Lloyd's has a current Best's Financial Strength Rating of A (Excellent).
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