London insurance market robust despite catastrophes: KPMG study
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LONDON—Despite a record level of catastrophe claims in the first half of 2011, the London insurance market remains robust, according to a benchmarking study by KPMG U.K. L.L.P.
The accounting firm’s analysis studied the results of nine London market insurers and concluded that despite high catastrophe claims, low investment returns and soft market conditions, the London market is “resilient.”
KPMG studied Amlin P.L.C., Aspen Insurance Holdings Ltd., Beazley Group P.L.C., Brit Insurance Holdings B.V., Catlin Group Ltd., Hardy Underwriting Bermuda Ltd., Hiscox Ltd., Novae Group P.L.C. and Omega Insurance Holdings Ltd., all of which have operations at Lloyd’s of London and other units.
Rate increases expected
While all the insurers studied reported losses from the series of natural catastrophes in the first half of the year, they also reported expected rate increases on catastrophe-exposed lines, according to the research.
Rates likely will increase further for this business, according to the study. “The challenge for the London market will be how much their customers can stand; understanding the level of premium increases compared to customer demands,” KPMG said.
The study also noted that rate increases will not be across the board.
Copies of the study are available on request.
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