Insurance hubs

Grant Thornton report underlines London’s pre-eminence as an insurance and reinsurance centre

Grant Thornton, the global accounting organisation, released its 2015 Insurance Hubs Report today.  The Report, prepared in partnership with UK Trade & Investment (UKTI), examines the relative merits of leading insurance hubs and compares the position with the last report in 2009.

The 2015 report, based on discussions with company leaders across the sector, suggests that London’s pre-eminence as an insurance and reinsurance centre has rarely been stronger.

Key findings of the Report include:

• Changing hubs is less fashionable than it was:  fewer insurers and reinsurers are considering relocating their headquarters jurisdiction compared with 2009
• A credible regulatory regime remains a key reason for selecting a jurisdiction
• Major strengths for London include English as the language of business, a plentiful pool of talent and easy access to markets
• Industry leaders expect the tax environment to continue to be a competitive strength of London’s position
• However, London is unlikely to become a centre for housing insurance linked securities

Peter Allen, Global Head of Insurance for Grant Thornton, said:  “Five years ago, we undertook research to investigate what was driving the debate on where insurers looked to domicile their businesses. Since then the market has undergone significant change in a number of key areas, so we felt it was time to revisit the topic.

“The first and most obvious conclusion from our research – which is supported by external sources – is that much of the heat has gone out of the debate. Ultimately, we believe that when trading circumstances are as tough as they are today, the question of domicile becomes of marginal importance. What will effectively determine the level of success for any organisation is the quality of its leadership, the underwriting talent and the overall financial strength of the company”.

Alexander Milne, Insurance Sector Specialist at UKTI, added:  “This report is an important contributor to the debate on what the UK and London Market can do to ensure its continued competitiveness. As the increasing localisation of business in the worlds developing markets continues the UK must build on its historic strengths, ensure that the regulatory environment for transacting business in the UK and London Market is optimal, and make sure we continue to attract new capital and people from developing and developed markets alike.

“As a key contributor to UK exports and a significant and sometimes overlooked strength of the UK economy, here at UKTI we are committed to working with the industry and the rest of government in ensuring that the sector is able to retain its internationally competitive edge.”