Energy Insurance The Road Ahead Dominick Hoare

The Loss/Profit Equation Inherent Business Dilemma Demands of Capital Stable Profit Environment Sustainable Business Concept

Current Environment Volatility Premium Increases Severe Loss Frequency Long Term Uncertainty

Toulouse

P36

Gulf of Mexico Blowout

Willis Loss Database YearsNo. of IncidentsTotal US$ Loss ,881,924, – ,323,966,884 All Years322536,205,891,439

Lloyd’s Energy Statistics Offshore Physical Damage - Incurred Loss Ratio

Lloyd’s Energy Statistics Control of Well - Incurred Loss Ratio

Lloyd’s Energy Statistics Onshore Physical Damage - Incurred Loss Ratio

Lloyd’s Energy Statistics Energy Liability - Incurred Loss Ratio

Lloyd’s Energy Statistics All Classes - Incurred Loss Ratio

Lloyd’s Peer Group

Rating Index

Equity Markets 9/11 P36 - March Toulouse - September

Situation Capital Intolerance Flawed Business Model Short Term Solutions vs. Long Term Business

Solution Mutual and Constructive Reduce Volatility Renewed Confidence Stable Capital

Fundamental Restructuring of Business Return on Capital Higher and Consistent Premium Levels Transparent Risk Transfer

Insured's Charter Higher Quality Product New Standard Levels Commitment and Continuity

Lloyd’s Flexible and Innovative Product Expertise and Professionalism Unique Talent Pool

Lloyd’s Chairman’s Strategy Group/Franchise Concept Proactive and Supportive Entrepreneurial Spirit Strong Corporate Governance

Lloyd’s 9/11 Trading Continuity Funding Obligations 2000 Gross Income – £ 10.2bn 2001 Gross Income – £ 11.6bn 2002 Gross Income – £ 12.8bn

Regulatory Environment Risk Focused Management LMP Reforms Product Centered Market Leadership from Lloyd’s

Re-Definition of Insurance Business Model Structural Change – Mutually Driven Product of Highest Quality and Integrity Sustainable and Profitable Is Failure an Option?

Energy Insurance The Road Ahead Dominick Hoare