The London market of Lloyd’s could post profits as high as $8.3 billion (3.7 billion pounds) for 2002 and 2003, says Moody’s Investor Service. This follows a loss of $4.7 billion (2.1 billion pounds) in 2001. Moody’s says 2002 should produce about $4.3 billion in profit, while 2003 profit, assuming a normal loss year, should be around $3.8 billion. Moody’s says market conditions for Lloyds are comparable to 1992-1993, with relatively loss-free conditions and almost full capacity. However, Moody’s notes that there will be wide variance in the performance of the strongest syndicates versus their weaker counterparts. While the market as a whole should produce profit at 12% of capacity, some players could produce profit of more than 20% of capacity. “Lloyd’s looks set to achieve a period of strong profitability for 2002 and 2003 in the current upturn, notwithstanding events such as Hurricane Isabel,” says Mark Hewlett, managing director of Moody’s European Insurance Division. “However, we remain cautious with regard to reserves for 2001 and prior in light of the significant reserving issues faced in closing these accounts.” Part of this caution comes from claims resulting from the World Trade Center attacks of September 11, 2001, which could linger on for years, including the issue of recoverables still due from reinsurers.