Lloyd's has underestimated its losses from the September 11 US terrorist attacks by £400m, according to analyst Fitch.
The market forecast the attacks would cost it £1.3bn, or 12% of its capacity, but now accepts the figure will probably rise.
Ratings agency Fitch believes the market stands to lose at least £1.7bn, or 15.4% of its capacity, after seeing “confidential information”.
Fitch downgraded Lloyd's financial strength rating from A+ to A- in the wake of the attacks on the World Trade Centre and warned the rating was liable to fall further should the losses turn out to be greater than initially forecast.
Fitch argued that losses from large catastrophes “have always been understated”.
It said insured losses from the Northridge earthquake in California in 1994 were originally projected by the industry at $2.5bn (£1.7bn) a month after the event, but by the year after had risen to $12.5bn (£8.5bn).
Fitch insurance analyst David Wharrier said: “We've got confidential information from companies who will have reinsured into Lloyd's.
“There seem to be a significant number of them saying they have significant recoveries to make from Lloyd's.
“Also, having spoken to participants in the market place, some of the numbers the Lloyd's entities have declared don't seem to match what they are saying as a group.
“And history shows that Lloyd's forecasting isn't great, although it is getting better.”
Fitch raised specific concerns about how Lloyd's might face difficulties, including worries about the central fund, reinsurance and liquidity.
Wharrier said Lloyd's central fund could come under increased pressure. The central fund is a reserve financed by Lloyd's members as a policyholders' protection fund. It is used if members fail to meet their underwriting obligations.
Lloyd's announced on Friday (September 28) it was increasing charges to syndicates from 1.1% to 2% specifically to boost the central fund. The change will take effect from next year.
He added that Lloyd's net loss could rise if reinsurers went bust, leaving the market with unrecoverable losses and predicted the bulk of the World Trade Centre losses would be felt by reinsurers.
Fitch said in a statement that “liquidity will pose a major issue for Lloyd's in the aftermath of the US terrorist attack”.
Lloyd's did not accept Fitch's figures. Spokesman Adrian Beeby suspected the figure of £1.3bn would rise, although he was unable to say by how much.
He said: “As they don't have access to any of the information we have used, it is unclear how they have come to this conclusion.
“There will be claims on the central fund, but we don't see it being exhausted.”
Between 1988 and 1992, the market lost £8.1bn. Losses from the World Trade Centre catastrophe would not approach such a figure and the central fund was not in danger, he said.
Beeby rejected concerns over liquidity, saying Lloyd's had £5bn in trust funds to cover claims in the US, but admitted: “We are going to have to move a substantial amount of funds out into the US.”
He said 90% of Lloyd's reinsurance cover on losses from the terrorist attacks was with reinsurers rated A or higher, cutting the likelihood of unrecoverable losses.