Moody's Investors Service has predicted a £7bn loss for the Lloyd's Insurance Market for the 1999-2001 years of account. This compares with Lloyd's own forecast of a £5.23bn loss.
On top of the £2bn loss for 1999 announced by Lloyd's, Moody's predicts losses of £2.2bn and £2.6bn for 2000 and 2001 respectively.
Moody's said that "although 1999 represented the bottom of the most recent downcycle, the forecast losses for 2000 and 2001 are worse because of the World Trade Centre (WTC) disaster".
It added: "There is no getting away from the fact that the losses incurred by Lloyd's over 199-2001 are substantial, are not yet fully reflected in syndicates' forecasts and reflect extremely poor market conditions and the major impact of WTC."
On a more positive note, Moody's has predicted a £1bn profit for 2002 - as long as it is a "normal" loss year.
