Lloyd’s Chief Executive Officer (CEO), Inga Beale, has said London’s access to talent and emerging markets must be prioritised if the city’s re/insurance industry is to thrive in future years.
And while these factors could become increasingly challenged in an era of populism and protectionism, Beale said she believes Brexit could also be an opportunity for the UK to “deliver on both.”
The Lloyd’s executive’s comments come after a report on the city’s insurance and reinsurance industry by London Market Group (LMG) and The Boston Consulting Group (BCG), was released earlier this week -showing a continued trend of London market losses in emerging market regions as well as the reinsurance sector.
Reinsurance declined from a 13.4% share of the global market in 2013 down to 12.3% in 2015 in the London.
In addition, attracting diverse talent remains a challenge in the London market compared with these prospects within other global hubs.
Pointing to these factors, Beale said it was time to up the ante in the efforts to reshape and modernise the London market for the needs of the future, although the report also showed some encouraging areas of high growth in specialised insurance and cyber solutions.
Beale added that London’s emerging markets decline gives cause to redouble efforts to improve London’s international business accessibility; “New research from the London Market Group (LMG) shows that the London insurance market has enjoyed growth from mature markets such as the US but its share of insurance growth has declined in emerging market regions, despite these regions enjoying strong overall growth themselves.
“This decline is a real cause for concern, particularly when you consider that London’s insurance market employs 52,000 people and accounts for just over a quarter (26 per cent) of the City’s overall contribution to UK GDP.
“If we’re going to turn this situation around we need better access to these fast growing markets,” Beale said, as reported by City A.M.
“Improved access and links with international markets are imperative if City firms are to continue growing and supporting the UK economy. Worryingly though, there are signs, even before Brexit, that our ability to trade with other markets is getting worse – not better – due to the protectionist sentiment we see rising around the world.”
“If we want London and the businesses based here to succeed in an increasingly competitive world, we need to make it an easier and more cost-effective place to do business. If we don’t, we run the risk of seeing London’s position steadily decline,” Beale continued.
The Lloyd’s CEO highlighted the positive steps already in motion to revamp the city’s re/insurance industry, urging market players to support initiatives such as TOM, the Placing Platform Limited (PPL), the Central Services Refresh Programme (CSRP), Delegated Authority (DA), and [email protected] “to help simplify and modernise our market and maintain London’s position as THE global centre of specialist insurance and reinsurance.”
Commenting on the upcoming UK elections and their impact on the re/insurance market, Beale said the UK needed a government that understands issues to do with international business; “Businesses operating in the Lloyd’s marketplace underwrite risks or reinsure business for almost every other country in the world. And to maintain that huge global reach we need open access, and also a workforce that represents the diverse markets we do business in. After all, these are the factors that have made Lloyd’s, and the City as a whole, so strong.
“Whoever is left in charge after the General Election will face the immense task of unravelling Britain’s relationship with the EU and redefining her place in the world. I do not underestimate that challenge. But, in the City, we ask the government for reassurance that access to talent and wide-ranging trade deals with fast growing economies will be top priorities.
“Lloyd’s is a historic City institution, a symbol of Britain’s openness and of London’s ability to attract the world’s best talent. For hundreds of years people looking to protect their assets have turned to London and to Lloyd’s for solutions. If the government delivers access to markets and access to talent, it will ensure the next hundred years will be defined by growth and opportunity.”