Specialist insurance and reinsurance market Lloyd’s delivered after-tax profits of £10.6bn in 2025, $1bn more than the previous year, with gross written premiums (GWP) up 4.2% year-on-year to £57.9bn, reflecting new participation in the market and continued expansion of existing syndicates.
The world’s oldest reinsurance market performed strongly in 2025, recording investment returns of £6 billion (5.6%), compared with £4.9 billion (4.7%) in 2024, driven primarily by income and realized gains from fixed income assets.
Strong premium growth was offset by a 2.4% unfavorable foreign exchange impact from a stronger pound against the dollar and a 3.7% price fall, which Lloyd’s said was consistent with a more competitive pricing environment.
Despite a year-on-year decrease of £100 million, market underwriting performance remained strong at £5.2 billion, with a combined ratio of 87.6%, slightly higher than 86.9% in 2024.
The primary claims ratio fell to 5.8% in 2025 from 7.8% in 2024, reflecting relatively mild catastrophe losses in the second half of the year. In 2025, the market’s primary claims volume will reach £2.4 billion (net of reinsurance and including recovery insurance payable and receivable), compared with £3.2 billion in 2024. The underlying combined ratio increases from 79.1% in 2024 to 81.8% in 2025.
The release of £721m of reserves last year boosted Lloyd’s combined ratio by 1.7% in 2025. Lloyd’s highlighted that favorable changes in real estate exposure were partly offset by stronger aviation and casualty provisions.
Expense ratio will reach 35.6% in 2025, up from 34.4% in the previous year, driven by earnings-driven commissions, hybrid-driven acquisition costs and foreign exchange effects.
Lloyd’s capital position remains strong, with total capital, reserves and subordinated loan notes increasing by 5.7% to £49.8 billion at the end of 2025. In addition, return on capital increased to 22%, while Lloyds Central Solvency Ratio increased to 496% and the overall market solvency ratio fell to 200%.
Patrick Tiernan, chief executive of Lloyd’s, commented: “Strong underwriting performance, disciplined growth and resilient investment returns underpinned the Lloyd’s market’s performance in 2025.
“Underpinned by a very strong balance sheet, these results provide a solid foundation for future challenges and risks, allowing markets to support communities, businesses and economies through uncertain times. While the financial cost of a 2025 disaster is relatively low, we remain acutely aware of the larger human impact and those whose lives are affected.
“Today, we also laid out a new five-year strategy to be market-driven, discipline-driven and, where necessary, strengthen our financial strengths. The strategy is focused on underwriting performance, driving efficiencies and maximizing our unique capital advantages to enhance returns.
“This is how we will drive and protect Lloyds’ position as the pre-eminent global insurance risk market.”
Today, Lloyd’s Markets also announced its new strategy, which is driven by four drivers: “Leading underwriting performance; more efficient markets that reduce friction and costs; maximizing our unique capital advantages to improve returns; and building a proud Lloyd’s by nurturing a culture of focus, innovation and talent.”
Lloyd’s said that while pricing conditions have become more challenging and volatility is rising, “our expectations have not changed and we remain confident in the market’s ambition to focus on sectors and categories with the strongest interest rate adequacy.”
Sheila Cameron, chief executive of Lloyd’s Markets Association, welcomed Lloyd’s new strategy.
“Lloyd’s has demonstrated a clear and coherent direction to focus on Lloyd’s fundamentals and build on its strengths in advancing and protecting markets. This strategy supports and services Lloyd’s core stakeholders (the managing agents). We believe this new direction will help Lloyd’s managing agents deliver better, more efficient outcomes for their own clients (policyholders).
“Maintaining market performance of a combined operating ratio below 95% through the cycle is the foundation upon which all Lloyd’s strategies must be built. In addition, a renewed focus on maximizing the capital advantage of new and existing syndicates is the right approach and builds on the foundations created by London Bridge 2. Ensuring a strong correlation between regulation and risk will also be warmly welcomed by the managing agents.
“We support the commitment to complete the backend re-platforming in a phased, controlled manner, which will enable managing agents to meet their regulatory operational resilience requirements and ultimately improve their trading efficiency.
“Finally, we particularly welcome Lloyd’s’s commitment to double the number of early career hires in order to deliver this talent into the market upon completion of relevant training. Training will be shared between Lloyd’s and market participants through a market secondment scheme. This initiative builds on the latest report from the London Market Group (LMG) which outlines that without proactive measures, only 7% of the London market will be under the age of 30 within the next decade.
“The LMA has raised some of these points with Lloyd’s over the past 12 months and we are grateful that Lloyd’s has agreed to drive these initiatives forward. We look forward to working with Lloyd’s to deliver this strategy and fundamentally change this market for the better.”
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