Lloyd's of London has reported a "record" profit of £3.7 billion for 2006.
In a statement, the specialist insurer confirmed that its strong performance resulted from a "benign year" for major natural disasters and higher rates.
The group reported a loss of £103 million in 2005 after being forced to pay out billions of pounds following a series of hurricanes which battered the US and Caribbean, including Hurricane Katrina.
But while Lloyd's chairman Lord Levene said that the insurer had benefited from "strong underlying conditions" thanks to an "exceptionally low" level of natural disasters in 2006, he warned that it would be "unrealistic" to expect a similar lack of claims from such events this year.
"With a trend for more frequent and severe natural catastrophes we must continue our focus on underwriting for profit," he said, adding "the market is well prepared to meet these challenges".
Lloyd's, which was formed over 300 years ago, also announced an improvement in its combined ratio, the percentage of premiums which represent claims and expenses.
The insurer said that its ratio was 83.1 per cent in 2006, down from 111.8 per cent in 2005.
In addition, Lloyd's said that its central assets had also increased by 14.8 per cent to £1.45 billion.
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