Lloyd's of London boss looks forward to private sector input at Cop28

John Neal expects global climate summit to include 'private sector-valuable discussions'

The Lloyd's Building, headquarters of Lloyd's of London, in the British capital's financial district. Getty Images

The chief executive of the insurance market Lloyd's of London said more involvement from the private sector at Cop28 is to be welcomed.

Speaking as Lloyd's of London announced strong first-half results, John Neal said the climate summit, which starts at the end of November in Dubai, will be an opportunity for businesses to discuss the next steps in financing the transition to a lower-carbon world.

“We're very active in the conversations we're having with the banks,” he said in response to a question from The National.

“How can banks and insurers work together to enable that financing to be released? Of course, the corollary of the benefit of that is that transition related activity creates both asset and liability interests that we can insure.

“So, our sense is that Cop28 is leaning back into private sector-valuable discussions and certainly our early indications is the attendance looks valuable for us.”

His comments came as Lloyd's of London released its first-half results, which showed a profit before tax of £3.9 billion, compared to a loss of £1.8 billion in the first half of 2022.

Profit from underwriting more than doubled to £2.5 billion, compared to the same period last year, and investment returns swung back to a £1.8 billion profit, having suffered a £3.1 billion loss in the first half of 2022.

“Combined with the market’s progress in driving sustainable performance, digitalisation and showing leadership from climate transition to culture change – these results set us up to deliver on our positive financial outlook for 2023,” Mr Neal said.

Estimated losses in the Lloyd's market from the conflict in Ukraine were £1.6 billion.

Natural disasters

Last month, reinsurer Swiss Re said insured losses resulting from natural disasters rose to $50 billion in the first half of this year, the second highest reading since 2011.

Severe thunderstorms accounted for 70 per cent of the total, with $34 billion of losses being recorded in the US alone, the highest ever in a six-month period.

With the 2023 Atlantic hurricane season well under way, the forecaster AccuWeather upgraded its prediction for the number of Category 3 and above storms from 1-3 to 3-5.

But at the moment, Mr Neal is not too concerned.

“We would anticipate natural catastrophe losses throughout the year,” he said in response to a question from The National.

“We create allowances for that throughout the plan. They are very much second-half oriented, largely due to our US predominance and our exposure to US hurricanes. So, it's something we would expect.

“The time it gets complicated is when you see two or three hurricanes back to back in one year. But one hurricane in the US is something we would expect to happen.”

AccuWeather warned that Hurricane Lee could strengthen to a Category 5 storm by the weekend as it barrels up the eastern Caribbean and possibly towards the US.