The Lloyd’s of London insurance market has reduced its exposure “as much as possible” to the crisis-hit euro zone in preparation for a collapse of the bloc’s single currency, its chief executive told the Sunday Telegraph newspaper.
Richard Ward said Lloyd’s had put in place a contingency plan to switch euro underwriting to multi-currency settlement if Greece abandoned the euro, and that it could have to take writedowns on its 58.9 billion pounds ($92.1 billion) investment portfolio if the euro zone broke up.
“With all the concerns around the euro zone at the moment, we’ve got to be careful doing business in Europe and there are a lot of question marks over writing business in the future in euros,” Ward told the UK newspaper.
“I don’t think that if Greece exited the euro it would lead to the collapse of the euro zone but what we need to do is prepare for that eventuality,” he said.
Europe accounts for 18 percent of Lloyd’s 23.5 billion pounds of gross written premiums, mainly in France, Germany, Spain and Italy, the newspaper said.
On Wednesday, Reuters reported that each euro zone country was preparing a contingency plan for the eventuality of Greece leaving the single currency.
Lloyd’s, which traces its origins back 324 years to a London coffee house where merchants met to insure ships, suffered its second worst ever loss last year after absorbing record claims from catastrophes including Japan’s Tohoku earthquake.
(source: Sunday Telegraph, Reuters)
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