An "exceptionally low" level of catastrophes enabled the Lloyd's of London insurance market to announce profits of £3.66 billion (€5.38 billion) for 2006 today.
The market, which is home to 66 insurance syndicates, made losses of £103 million (€152 million) in 2005 after two years of severe hurricanes in the United States.
In addition to the low level of catastrophes in 2006, Lloyd's said the market had performed well amid strong underlying trading conditions. However, Lloyd's chairman Lord Levene said it would be unrealistic to expect such a favourable claims environment to continue this year.
While the number of hurricanes in 2004 and 2005 - including storms Katrina and Rita - meant the market benefited from higher rates on wind-exposed business, it pointed out that other lines of insurance showed signs of softening.
The market's focus on underwriting for profit rather than market share was shown in its combined ratio, which is the industry's measure of profitability.
With a figure below 100 per cent representing a profit, Lloyd's said its ratio of 83.1 per cent compared favourably with an estimated average of 93 per cent for US property and casualty insurers and 94 per cent for European insurers and re-insurers.