Intelligent Insurer EDITORIAL


INTELLIGENT INSURER IS PUBLISHED BY NEWTON MEDIA LIMITED. 15-17 Newton Way


Woolsthorpe-by-Colsterworth NG33 5NR United Kingdom www.newtonmedia.co.uk


DIRECTORS AND PUBLISHERS Nicholas Lipinski and John Eddington


Telephone: +44 203 301 8201 Email: nlipinski@newtonmedia.co.uk


CONSULTING EDITOR Wyn Jenkins


DEPUTY EDITOR Richard Mackillican


Telephone: +44 203 301 8209 Email: rmackillican@newtonmedia.co.uk


SUB-EDITOR Susan Gault


Ros Bromwich


JOURNALIST Mark Dugdale Helen Yates


ADVERTISING CONTACTS John Walsh


Telephone: +44 203 301 8206 Email: john.walsh@newtonmedia.co.uk


Adrian Tapping


Telephone: + 44 203 301 8203 Email: atapping@newtonmedia.co.uk


John Eddington


Telephone: +44 1476 861 737 Email: john@newtonmedia.co.uk


PRODUCTION AND DESIGN


Strano and Pettigrew Design Associates Inc. 67 Mowat Avenue, Suite 239 Toronto M6K 3E3 Canada


Telephone: +1 416 533 7171 Fax: +1 416 535 7526


Email: info@stranoandpettigrew.com www.stranoandpettigrew.com


©Newton Media Limited 2011. All rights reserved.


No part of this publication may be reproduced, stored in a


retrieval system, or transmitted in any form or by any means, electrical, mechanical, photocopying, recording or otherwise without the prior written permission of the publisher.


The views expressed in Intelligent Insurer are not necessarily those shared by the publisher, Newton Media Limited. Wishing to refl ect the true nature of the market, the editor has included articles from a number of sources, and the views expressed


are those of the individual contributors. No responsibility or liability is accepted by Newton Media Limited for any loss to


any person, legal or physical, as a result of any statement, fact or fi gure contained in Intelligent Insurer. This publication is not a substitute for advice on a specifi c transaction.


The publication of advertisements does not represent endorsement by the publisher.


Intelligent Insurer—ISSN 2041-9929 Cover image: © Gen Re


This issue will be unlikely to supersede some of the bigger, more general, industry issues, however. The dynamic in the industry remains paradoxically problematic. Wider economic troubles


and a very poor investment environment mean that the industry remains something of a safe haven for investors. This has kept capital in the industry and is even attracting additional money in small amounts.


This solid capital base means that competition for business remains fi erce. This, in turn,


is keeping rates low. Yet the irony is that insurers and reinsurers also face the same tough challenges securing decent investment returns—squeezing their profi ts in the process.


This dynamic now seems likely to continue well into 2012. Gradually, as the world


economies and investment markets improve, capital will eventually leave the industry and rates will harden.


For now, however, expect a bumpy ride into the next renewals. And on top of all of that,


US companies are facing increasing stiff competition from their international peers, which are suddenly enjoying an increasingly easier time in the US thanks to many states relaxing collateral requirements.


This challenging environment means that US companies will have to work even harder than


before to develop new and more innovative products that address the needs of policyholders in ways in which their competition do not.


November 2011 | INTELLIGENT INSURER | 3


that they have their own challenges to ponder. A recent report by Lloyd’s of London has caused controversy in the domestic US insurance market. It suggested that government intervention in insurance markets causes more problems than solutions and that state and federal involvement should be kept to a minimum. It cited the development of a government- backed reinsurance fund for Florida as an example of where a scheme has done more harm than good.


W


It is not the only example of government involvement in insurance in the states. The report will likely be the subject of debate in the lead up to the renewals.


hile US insurers and reinsurers will have one eye fi rmly fi xed on the economic troubles in Europe, and their consequences for world economies, as they head into the biggest industry conference of the year, they will be acutely aware


Only hard work ahead


Page 1  |  Page 2  |  Page 3  |  Page 4  |  Page 5  |  Page 6  |  Page 7  |  Page 8  |  Page 9  |  Page 10  |  Page 11  |  Page 12  |  Page 13  |  Page 14  |  Page 15  |  Page 16  |  Page 17  |  Page 18  |  Page 19  |  Page 20  |  Page 21  |  Page 22  |  Page 23  |  Page 24  |  Page 25  |  Page 26  |  Page 27  |  Page 28  |  Page 29  |  Page 30  |  Page 31  |  Page 32  |  Page 33  |  Page 34  |  Page 35  |  Page 36  |  Page 37  |  Page 38  |  Page 39  |  Page 40  |  Page 41  |  Page 42  |  Page 43  |  Page 44  |  Page 45  |  Page 46  |  Page 47  |  Page 48  |  Page 49  |  Page 50  |  Page 51  |  Page 52  |  Page 53  |  Page 54