Lloyd’s is not expecting major losses as a result of the sudden death of Michael Jackson. That is in part because London market underwriters considered the pop star a high risk. Bart Nash, a spokesman for Lloyd’s, would not offer a figure for the likely loss. David Foreman, group director of underwriting at Ark Syndicate Management Ltd. in London, put the size of the potential loss at under $100 million. Foreman told A.M. Best Jackson was widely regarded as unstable and “not the best insurable risk from that perspective.” While Jackson had been scheduled to give 50 concerts in London beginning in July, Foreman said the insurance would have likely only been in place for just the first three concerts, with cover for the next set of three being arranged once the first three had gone ahead successfully. Jackson died on June 25 of an apparent heart attack at the age of 50. Foreman does not expect Jackson’s death to produce any new lessons for the insurance market or consume large amounts of capital. The enduring guideline, he suggested, should be careful underwriting. “Hurricanes happen,” he said. “Earthquakes happen, and somebody dies.”

July 1, 2009