Lloyd’s of London Says Thai Floods May Cost It $2.2 Billion

Lloyd’s of London, the world’s oldest insurance market, said claims related to the floods in Thailand last year may cost it $2.2 billion.

The forecast is based on an estimated industrywide loss of $15 billion to $20 billion, Lloyd’s said in a statement today.

“As additional information emerges, Lloyd’s actual net claims from these events may vary from this preliminary estimate,” Lloyd’s said. “These events are not expected to give rise to either any material claims on the central fund or to any material change in the overall level of capitalization of the market.”

Earthquakes in Japan and New Zealand, windstorms in the U.S. and flooding in Thailand cost insurers about $105 billion last year, making it the industry’s most expensive year on record, surpassing the $101 billion paid out in 2005, the year Hurricane Katrina struck New Orleans, according to Munich Re. Insurers typically seek to raise prices to make up for losses following a costly claims period.

“Our priority remains to assess and settle valid claims as swiftly as we can,” Lloyd’s Chief Executive Officer Richard Ward said in the statement. “The Lloyd’s market is as well capitalized as it has ever been. Paying these claims is within the normal course of business for Lloyd’s.”