Diaster
Disasters such as the Japan earthquake, led to huge insurance claims. (Reuters / Toru Hanai)

Lloyd's of London insurance market suffered a major loss in 2011 following mass payouts after the worst year for natural disaster insurance claims in its history.

Lloyd's, the world's oldest insurance market, made a loss of £516m in 2011, its second biggest ever loss, compared with a £2.2bn profit in 2010. Total net claims were £12.9bn.

The loss reflected the aggregate financial performance of the 80 competing insurance syndicates that make up the Lloyd's market.

Lloyd's chief executive Richard Ward pointed to natural catastrophes such as heavy floods in Thailand and Japan's Tohoku earthquake leading to massive claims.

"Make no mistake, 2011 was a difficult year for the insurance industry," he said. "Given the scale of the claims, a loss is unsurprising."

He said it was reassuring that, despite the loss, the market's "financial strength has been maintained".

Lloyd's only suffered a greater loss, of £3.11 billion, following the 2001 September 11 attacks.

According to insurance broker Aon Benfield, 2011 was the second most expensive catastrophe year ever for the insurance industry, with total disaster-related claims of £107bn.