Could Lloyd’s of London Insurance COVID 19 Claims Rival That Of 9/11?

Since the WHO declared it to be a pandemic back in March 2020, could the Lloyd’s of London’s COVID 19 insurance claims rival that of the September 11, 2001 era terror attacks?

By: Ringo Bones

Back in May 2020, Lloyd’s of London is likely to pay out 3.0-billion to 4.3-billion US dollars in insurance claims related to the COVID 19 pandemic, similar to losses from the September 11, 2001 terror attacks. This is largely due to the pandemic causing a lockdown on economies around the world, bringing business, events and travel to a halt and leading to hefty claims. And according to Lloyd’s, global non-life underwriting and investment losses for the whole of 2020 could hit a record 203-billion US dollars. Zurich Insurance is also looking at 750-million US dollars in non-life pandemic claims for 2020.

In a double blow to the industry, insurers have also lost money due to falling markets, slashing the investments they use to pay out claims. Global insured loss forecasts of 107-billion US dollars are similar to natural catastrophe losses in 2005 led by Hurricanes Katrina, Rita and Wilma and to 2017 including Hurricanes Harvey, Irma and Maria, according to Lloyd’s. The company’s estimates do not include life insurance and assume continuing social distancing and lockdown measures in 2020, as well as a drop in global GDP.

The bulk of the insurance losses come from cancellation or postponement of major events around the world – including the 2020 Tokyo Olympics, business interruption claims on property insurance and trade credit. Small businesses in Britain are battling insurers who they say have denied them payments for disruption. The insurers say most small business policies do not cover the COVID 19 pandemic. Lloyd’s of London insurer Hiscox is one of those under scrutiny.