The Use of Clustering in Analysis of Business Lines in the Insurance Industry in Conditions of Crisis: The Case of Lloyd’s of London
The Use of Clustering in Analysis of Business Lines in the Insurance Industry in Conditions of Crisis: The Case of Lloyd’s of London

Summary/Abstract: In an era of the overlapping effects of the Covid pandemic and the conflict in Ukraine, it is worth taking acloser look at the markets that focus on risk management, that is, the insurance market, in terms of its furtherorganization and development. The aim of the paper is to examine how the crises related to the Covid-19pandemic and the conflict in Ukraine have affected insurance business lines (using a case study of Lloyds). Thestudy’s use of clustering (Ward's method) for insurance business lines at Lloyd’s, and its analysis within dynami-cally changing conditions, is expected to achieve preliminary classifications and insights for further more ad-vanced research, resulting in more effective insurance activities. The impact of the discussed crises on clusterformation is significant. The study is divided into three main periods of analysis: the pre-Covid-19 period, theCovid-19 period and the Covid-19 recovery period (which occurred at the same time as the deepening of theconflict in Ukraine). Clustering highlighted the impact that the described crises have had on the performanceof individual lines of business. In addition, it also turned out the division into clusters for insurance and reinsur-ance is not uniform. The exceptions are the years 2021 and 2022, in which clusters are formed identically forinsurance and reinsurance. The results of the research highlight the necessity for further exploration of thestudy area in order to ensure the best possible further sustainable development of the insurance industry, andto better prepare it for any inconveniences or crises that may affect it.

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