Moody's predicts losses will be worse

Only 24 out of 124 Lloyd's syndicates expect to make a profit for the 2000 year of account, according to latest Lloyd's figures.

Lloyd's shows that a further three: Atrium 570, Crowe 1204 and Chaucer 1301 have estimated they will break even for 2000. The remaining 97 syndicates anticipate posting a loss.

The most profitable syndicates such as Chartwell 44, Wren 389, SMSM 429, St Paul 779 and Crowe 982, wrote life business.

Non-marine business is also understood to have bolstered returns for syndicates including Kiln 557, Cox 1176 and Limit 386. Motor syndicates also said they anticipated making a profit.

One analyst said that although four out of five syndicates were anticipating losses or breaking even for the 2000 year of account, the estimates had changed by only 2.38% since the third quarter.

"There has been only a slight deterioration," he said. "Most people are looking towards the future now."

But Moody's Investors Service anticipates Lloyd's will have larger losses than currently forecast.

It predicted for the 2000 and 2001 years of account losses of £2.2bn and £ 2.6bn respectively, compared with Lloyd's forecasts of £1.7bn and £1.6bn losses.

Moody's European insurance managing director Mark Hewlett said: "There is no getting away from the fact that the losses incurred by Lloyd's over 1998 to 2001 are substantial, are not yet fully reflected in syndicates' forecasts and reflect extremely poor market conditions and the major impact of the World Trade Centre. We expect there to be a wide variance between the results of the best and worst performing syndicates.

"A number that have survived into 2002 are likely to become further victims of legacies of the past. But there will be a number which we believe will produce profits significantly above the market average."