Lloyd’s absorbs major 2005-06 claims hits in Canadian market

Lloyd’s of London in Canada paid out more for claims in 2005 than it collected in premium, Lloyd’s chairman, Lord Levene, indicated in a July speech to the Vancouver Board of Trade.
“What we’ve seen in Canada has caused a few frown lines,” Levene said in the text of his speech. “In 2005, Lloyd’s underwriters paid some significant claims arising out of a variety of risks a fire at an Alberta oil sand facility, a U.S. securities action against a major Canadian financial institution and the August rainstorm in Ontario that province’s worst ever natural disaster in terms of insured losses.
“This year and closer to home Lloyd’s has shared in the almost CD$70 million in insured damages arising out of the Queen of the North ferry sinking [in B.C.].
“Lloyd’s pays out almost CD$6 million a day, on average, to Canadian policyholders. In fact, last year in Canada we paid out more than we took in something we can afford, but we don’t want to make a habit of it!”
Levene took the opportunity in his speech to notice Canada is lagging behind other countries in terms of providing terrorism coverage. That’s in part due to the fact that such cover has not been sought in a way that it has in other countries, he added.
“Canadian urban centers have been thankfully spared the recent al Qaeda-inspired attacks experienced by New York, London, Madrid, Nairobi, Bali and many other cities around the world,” Levene said. “By all accounts, Canada’s domestic security services have done a top-notch job. But that should not breed complacency.
“Despite being a declared Al Qaeda target, Canada is unique in the developed world for not having any formal mechanism to provide businesses with cover against the risk of terrorist attacks.”