Lloyd's has warned that it could report its first financial loss since 2001 after doubling its estimate of claims from this year's devastating Atlantic hurricane season.
It increased its forecast of losses from hurricanes Katrina, Rita and Wilma from £1.4bn to £2.9bn.
Lloyd's said: "As a result, the chances of the market making a profit in 2005 are now small." But it added that the market remained "financially strong".
A statement said: "The market expects to be able to meet all its liabilities with immaterial impact on the Central Fund. Further, there is nothing to suggest that any syndicate will be unable to trade forward as a result of the hurricanes."
As predicted last week by Insurance Times, Lloyd's announced a 7% increase in capacity for 2006 to £14.7bn
Meanwhile, Kiln said this year's US hurricanes would hit its pre-tax profits by £60m to £80m. And Catlin said it has now estimated net losses for hurricanes Katrina, Rita and Wilma to total $305m. Catlin said this followed a £75m increase in the net estimate for hurricane Katrina to $200m.