The world’s largest insurance market said in a statement that it now expects to pay out up to £5.0 billion in claims, compared with an earlier estimate of US$4.3 billion in May.

Lloyd’s said it expects to recoup £2 billion of the payouts from reinsurers.

“The first half of 2020 has been an exceptionally challenging period for our people, our customers, and for economies around the world,” chief executive John Neal said in a statement.

“The pandemic has inflicted catastrophic societal and economic damage calling for unparalleled measures to stifle the spread of the virus, and to get businesses and economies back on their feet.”

Lloyd’s said its Covid-19 claims after reinsurance recoveries totalled £2.4 billion in the first half, pushing it into a pre-tax loss of £438 million.

In May, Lloyd’s estimated that pandemic would cost the global insurance industry more than US$200 billion.