Lloyd’s managing agents are predicting their businesses will get a big boost from the market being granted a licence to write direct insurance in China [See IJ web site – [https://www.insurancejournal.com/news/international/2010/05/19/109979.htm].
Stephen Catlin, Chief Executive of Catlin Group Limited and Peter Nash, Managing Director of Sportscover, both indicated that they are “excited about the prospects for their businesses created by the new licence,” states an article on the Lloyd’s web site (www.lloyds.com).
Their companies have done reinsurance business in China for several years through Lloyd’s Reinsurance Company China Ltd (LRCCL) and both men were in Shanghai in May as part of the Lloyd’s delegation when the historic news was announced. Lloyd’s insurers will now be able to offer Chinese policyholders “a variety of specialist products that are not currently available to them,” Catlin explained.
Lloyd’s noted that “among those new niche products set to be on offer to Chinese people will be insurance for amateur sports enthusiasts.” Nash sees a big potential demand for his company’s products from China in the years ahead due to the rapid and significant changes to its society that have occurred in the past decade. “The new direct licence will have a big impact on our business,” he stated.
China’s economy grew by 8.7 percent last year despite the global financial turmoil, which pushed the world’s economy into recession and triggered a slump in international trade. It is only a matter of time before it takes the US’s mantle as the world’s largest economy, experts predict.
“China has opened up culturally as well as commercially. Its citizens can now own real estate, cars and shares,” Nash continued. “The result is that a middle class has quickly emerged. For the first time in generations Chinese not only have free time but also money to spend in that time. This provides the perfect environment for an amateur sports insurer like Sportscover, because many people will choose to spend their free time either playing golf, basketball or soccer, going to the gym or running marathons.”
He also pointed out that “if you couple this with the fact that the population in Shanghai alone is greater than in the UK then you have a pretty fertile market.” Challenges remain, such as the absence of a wide network of brokers to sell these new products. “But we still believe that over time this will become one of the biggest, if not the biggest, market in which we deal,” he concluded.
Source: Lloyd’s of London
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