A London insurer says it has had a run of claims on letters of credit (L/Cs) it has insured.

The losses have caused Beazley to express caution about trade and political risks for the rest of this year.

L/C claims

Beazley says the claims relate to L/Cs mainly issued by failed private banks in the Ukraine, Kazakhstan and Bahrain.

It expects such claims to persist. "We have taken a view that claims may continue at a high level into 2010," the firm said in a statement.

Reserve increase

The Lloyd's of London insurer says it has increased reserves to cover both the 2009 claims and anticipated 2010 claims.

The cost of the reserves increase has diminished the insurer's profits by £33 million, although Beazley still managed to report a 15 per cent rise in full-year pre-tax profits to £100.7 million.

This was due to strong performance in other aspects of its insurance business and robust investment returns.

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