Tiernan sets out five-year strategy as Lloyd’s delivers strong 2025 result

Lloyd’s has delivered a strong underwriting and investment performance in 2025, as CEO Patrick Tiernan set out a new five-year strategy focused on sharpening returns and maintaining discipline through a more competitive cycle.

The market reported gross written premium of £57.9bn, up 4.2% on the prior year, with volume growth of 10.3% driven by both new entrants and expansion from existing syndicates.

This was partially offset by a 3.7% reduction in price and a negative foreign exchange impact as sterling strengthened against the US dollar.

Lloyd’s delivered an underwriting result of £5.2bn, broadly in line with the previous year, with a combined ratio of 87.6%.

The major claims ratio improved to 5.8%, reflecting relatively benign catastrophe losses in the latter part of the year, while the underlying combined ratio rose slightly to 81.8%.

“Strong underwriting performance, disciplined growth, and resilient investment returns underpinned the Lloyd’s market’s result in 2025,” said Patrick Tiernan, CEO of Lloyd’s.

“Supported by a very strong balance sheet, these results provide a firm foundation for the challenges and risks ahead, enabling the market to support communities, businesses and economies through periods of uncertainty,” he said.

Prior year reserve releases contributed a 1.7% benefit to the combined ratio, supported by favourable property development, although this was partly offset by strengthening in aviation and casualty reserves.

The expense ratio increased to 35.6%, driven by higher commissions linked to profitability, acquisition costs and foreign exchange effects.

Investment returns provided a significant boost to overall performance, with Lloyd’s generating £6.0bn, equivalent to 5.6%.

This was supported by income and realised gains from fixed income assets, alongside positive equity market performance and mark-to-market gains as interest rates declined.

The market’s capital position strengthened further, with total capital, reserves and subordinated debt rising to £49.8bn.

Return on capital increased to 22.0%, while the central solvency ratio rose to 496%, well above regulatory requirements.

Tiernan said the results provide a platform for the market’s next phase, as Lloyd’s moves into a more competitive pricing environment.

“Today we are also setting out a new five-year strategy — a disciplined, market-led and necessary sharpening of our financial edge,” he said.

“It focuses on underwriting performance, improving efficiency and maximising our unique capital advantage, to drive improved returns,” Tiernan continued.

The strategy is built around four priorities, underwriting performance, marketplace efficiency, capital optimisation and culture, as Lloyd’s looks to maintain its position as a leading global insurance marketplace.

“This is how we will advance and protect Lloyd’s as the pre-eminent global marketplace for insurance risk,” Tiernan added.