Lloyd’s of London says its exposure to the Baltimore bridge disaster could be £500m ($658m) with most claims for the likely biggest-ever maritime loss resting with US insurers.

The world’s largest insurance marketplace reported a sharp increase in profits on Thursday in the first half of 2024 despite looming Baltimore losses estimated at up to $4bn.

Lloyd’s of London profits rise during insurance supercycle
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Lloyd’s share of losses could be up to £500m based on the assumption of a total loss after the 9,962-teu Dali (built 2015) crashed into the bridge in March.

The accident, following a loss of power on the container ship, brought down the bridge, shutting down Baltimore port for weeks and leaving six bridge construction workers dead.

“We’ve just assumed that it is a near total loss — whether it is or it isn’t, remains to be seen,” Lloyd’s chief executive John Neal said.

“The encouraging thing on Baltimore … is the market’s done exactly what I hoped it would. It’s really stood up to be counted in dealing with that loss. So no, we don’t see uncertainty in the reserve.”

Lloyd’s chairman Bruce Carnegie-Brown said the Francis Scott Key Bridge and the port of Baltimore were both fully insured but with coverage primarily in the US.

Lloyd’s was exposed to costs relating to the ship, its cargo and for business interruption for cargoes stuck in the port, he said in an interview with London’s Evening Standard.

“Those claims develop over time… but we’ve put a number on our share of that at around £500m,” the daily reported him as saying.

UK-listed London insurers including Hiscox and Lancashire Group have confirmed they have exposure to the disaster.

Hiscox said the costs would be moderate while Lancashire said it was “within our expectations” for an event of its type. At the time of the incident, Lloyd’s said that no syndicate was left over-exposed.

The final bill is likely to take years to resolve. The vessel’s owner, Grace Ocean, and manager, Synergy Marine, have applied to the US courts to limit their liability to $44m, a move that the Baltimore authorities have vowed to fight.

On Thursday, Lloyd’s reported pre-tax underwriting profits of £4.9bn for the first six months of the year, up 26% from the same period in 2023.

It reported an underwriting profit of £3.1bn, up 24% from the same period last year.

Chief financial officer Burkhard Keese said the combined ratio was 83.7%, an improvement of 1.5% on the previous period last year. A combined ratio of below 100% represents an underwriting profit.

“This is a great underwriting result,” he said.

Gross premiums stood at £30.6bn, a growth on the previous year of $6.5%, largely because of an increase in business.

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