In a recent survey, law firm DWF LLP found that UK re/insurers and brokers expect the London Market to retain its status as a global leader in the reinsurance sector over the next five years.
DWF reported that 70% of respondents thought that reinsurance would remain a key product line for the London Market, potentially due to the significant presence of global reinsurance companies in the current market.
Lloyd’s managing general agents (MGAs) were, however, less convinced by the market’s prospects in the reinsurance sector, with just 45% expecting the London Market to be a global leader in five years.
Energy risk was considered to be the most likely product line for the London Market to remain a global leader in, according to 82% of total respondents and 72% of Lloyd’s MGAs, with excess layers and emerging risks, such as cyber, also regarded favourably.
Lloyd’s managing agents also felt much more strongly than re/insurance companies or brokers that intermediary remuneration and transactional transparency will be the most significant change in the re/insurance market over the next five years.
MGAs were also most optimistic about market hardening, which is likely linked to their expectation that their role as centres of underwriting excellence will grow significantly.
Overall, respondents agreed that the future of the London Market lies in deploying broking and underwriting expertise to intermediate risks for insurers and reinsurers outside the UK.
DWF conducted its survey over October and November 2017, questioning 100 re/insurance companies, 50 brokers, and 50 other re/insurance firms.
In general, the survey revealed that the UK re/insurance market considers itself well-placed to overcome the challenges of global technological and economic disruption, but less confident in regard to its efficiency, diversity, and cultural fitness.
