Beazley pointed to cyber crime protection and the space industry as areas of growth and innovation in the Lloyd’s of London insurance market as its 2022 profits took a hit from investment losses.
The FTSE 100 company has become a leading provider of insurance against cyber attacks, an high growth area for the Lloyd’s insurance market. After a series of high-profile hacks targeting big name companies including Royal Mail and The Guardian newspaper last year, demand is up “exponentially”.
Adrian Cox, chief executive, told The Standard that “cyber insurance is going to be as a common purchase in a few years as office insurance is now for most companies.”
“Lloyd’s has got a market share of between 20% and 25% for cyber. When new classes of risk emerge, the London market can demonstrate its ability to innovate and create and cyber is testament to that.
“Looking forward in London, the latest subject is insurance products we can create to help clients transition to a low-carbon environment, how can we de-risk that for clients. London is good at that,” he added.
Beazley has a track record for innovation and has already taken underwriting policies into space, covering plans for commercial moon rover landings by the Japanese company Dymon.
Cox identifies more potential around the final frontier. “Our view on the satellite industry and the space industry is that it is going to grow very strongly over the next few years ... we do think it’s going to be an increasingly important part of the global economy and it would be great if the UK did realise its space ambitions. And we would certainly be a part of the insurance world that supports it.”
The company’s results for 2022 were exposed to the market implications of rising interest rates at central banks, which drew investors away from the government bonds insurers hold to help meet payouts, cutting their value. The global trading pattern knocked Beazley’s portfolio down by almost $180 million (£150 million) on a mark-to-market basis. Profit before tax for 2022 dropped almost 50% to $191 million.
But a key measure of profitability for insurers, the combined ratio, reached forecasts at 89%, down from 93% a year earlier.
