London and Bermuda: Charting a Course of Market Access, Regulatory Standards
Global insurance market united in fighting protectionist legislation and excessive regulation
LONDON, Feb. 26, 2015 /PRNewswire/ -- In a speech delivered today before the Insurance Institute of London at Lloyd's, Bradley Kading, president and executive director of the Association of Bermuda Insurers and Reinsurers (ABIR), the association representing the interests of 21 commercial insurers and reinsurers with underwriting operations in Bermuda, addressed the thriving partnership between the London insurance market and Bermuda.
"Lloyd's and ABIR are proud partners in commercial insurance and reinsurance markets," said Kading. "Lloyd's reputation and history helps Bermuda carriers establish credibility and gain access to markets where barriers exist – a key reason why ABIR and Bermuda are heavily invested in the UK market."
In his remarks, Kading noted that Bermuda insurers have invested £3.6 billion in shareholders' funds to 16 UK insurers; ABIR members and other Bermuda insurers account for 24 percent of the Lloyd's of London premium volume; Bermuda's insurers have contributed more than 50 percent of the estimated loss payments for some large European insurance events; and, ABIR members employ 5,500 people in the United Kingdom.
In December, Lloyd's of London Chair John Nelson called ABIR and Lloyd's underwriters "trusted competitors and partners." Building on Chairman Nelson's observation, Kading cited four benefits that Bermuda and London each bring to the partnership:
- ABIR's members' $95 billion in capital builds a strong financial foundation for Lloyd's and the London company markets.
- ABIR's members' leadership in property catastrophe reinsurance globally creates opportunities for Lloyd's syndicates.
- ABIR's insurers' US market subsidiaries afford Lloyd's franchises with business opportunities.
- ABIR's members' balance sheets create global diversification benefits which expands capacity.
- Lloyd's global licenses benefit ABIR members with Lloyd's syndicates.
- Lloyd's reputation and history helps Bermuda carriers establish credibility and provides access to markets where barriers to entry may exist for Bermudian legal entities.
- Lloyd's specialty market business creates business opportunities for ABIR's members.
- Lloyd's efficient capital rules lead to higher returns on equity that benefits shareholders.
Kading noted that Lloyd's, the London company market, ABIR and other insurance associations are united in their efforts to battle global protectionist legislation and excessive regulation. In his speech, Kading cited five measures where the global insurance market is united in its fight against this harm to the industry:
- Ensuring that the Insurance Capital Standard (ICS) under development from the International Association of Insurance Supervisors (IAIS) does not create excessive or duplicative regulatory capital requirements.
- Certifying that the European Union's Solvency 2 rules are implemented in a way that minimizes overlap and redundancy in group supervision while instilling trust and deference for equivalent group supervisors.
- Resisting efforts to localize assets and capital, limit branching or limit cross border trade.
- Opposing jurisdictional action to limit affiliate transactions via regulatory or tax policy.
- Promoting the reinsurance value proposition that global diversification of risk via cross border reinsurance expands capacity, keeps markets competitive and creates lower prices for consumers.
"We have many global challenges on which ABIR, the London company market and Lloyd's are working together," Kading concluded. "The stronger the partnership with our international counterparts, the more successful we will be in fighting the rise of protectionism."
About ABIR: The Association of Bermuda Insurers and Reinsurers (ABIR) represents 21 commercial insurers and reinsurers with underwriting operations in Bermuda. Bermuda is the center of global expertise on underwriting for catastrophe risk transfer products. For more information, please visit: www.abir.bm
For more information:
@ABIR_Bermuda
Contact: [email protected] | @abir_bermuda
SOURCE Association of Bermuda Insurers and Reinsurers (ABIR)
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