LONDON (Bloomberg) - Lloyd's of London, the world's biggest insurance market, said Bermudian insurers are "interested" in joining Lloyd's to lower their dependence on the US and improve their credit ratings.

"Bermuda has shown a lot of interest in Lloyd's," Lloyd's finance director Luke Savage said in an interview yesterday. "The demand has been there for the last couple of years."

Expansion from Bermuda to London may signal a reverse of the trend in recent years, when insurers including Lancashire Holdings Ltd., Ace Ltd. and Hiscox Ltd. built up units in Bermuda. The companies raised billions of dollars in 2005 to take advantage of higher premiums that followed the most costly US hurricane season on record. Hurricane Katrina destroyed New Orleans that year killing 1,833 people and causing an estimated $81 billion in damage.

Bermudian insurers may get better credit ratings if they seek customers globally to ease the volatility of their earnings and head off increased competition, ratings agencies have told them, Mr. Savage said.

"If they've got to seek diversity the easiest way to do that is to tap into the Lloyd's brand and the Lloyd's license network," he said.

The London-based market, which has licenses to insure risks in about 200 territories, last year gained seven new managing agents, or companies that sell insurance, bringing the total number to 52, Lloyd's said. The number of companies providing capital grew seven percent to 1,238, while private investors, or Names, fell 15 percent to 773.

Lloyd's said today pretax profit declined 51 percent last year to £1.9 billion ($2.8 billion) on lower investment returns and losses in claims from hurricanes Ike and Gustav. The results are an aggregate of all the companies who write insurance through the Lloyd's market.

Investment returns fell to £957 million from £2 billion a year earlier. Lloyd's said its combined ratio was 91.3 percent, compared with 84 percent in 2004.

The combined ratio is claims and expenses as a percentage of premiums. The further the measure is below 100 percent, the larger the company's underwriting profit.

Amlin plc. and Catlin Group plc., two of the three biggest publicly traded Lloyd's insurers, have seen profit dwindle as falling equity and bond markets eroded returns on investments.

Lloyd's surplus on the prior year's reserves, a measure of financial strength, increased 48 percent to £1.27 billion.