Posted on 21 Jun 11
With two billion people from the burgeoning economies of Brazil, Russia, India, and China (BRIC) set to join an emerging global middle class in the next 20 years, the insurance industry is facing a “golden age” of opportunity. This prediction was made by Joe Plumeri, Chairman and CEO of Willis Group Holdings, the global insurance broker, who opened an insurance conference in Bermuda last week.
Speaking to the island's key insurance stakeholders at the Insurance Day Summit in Bermuda on June 14, Plumeri said, “Over the course of the 21st century, the wealth and insurable value that the exploding global middle class will create will be unprecedented in history. The resulting global demand for insurance will dwarf the capital and capacity of today's insurance market.”
Pointing to the ways that the insurance industry, and in particular Bermuda, stepped up to pay claims after 9/11 and how it innovated to respond to new risks in the past, Plumeri said that the industry would rise to the new challenges presented by the growth of the BRIC economies by “harnessing the strength of the global capital markets to provide tailored insurance for home and business.”
“The new middle class will need brokers that understand them and their industries,” he said. “They’ll need carriers who are innovative, financially secure, and who are there when they need them – carriers with a reputation for paying legitimate claims quickly.”
The golden age of insurance will also be spurred by developments in the West, Plumeri said, and particularly in the US where economic troubles are reducing the Government’s appetite for public insurance. Citing talk of a scaling back of the Terrorism backstop and the unsustainability of the National Flood Insurance Program, Plumeri said that, “As the public sector inevitably retreats, opportunities will be created for the insurance industry in many areas.”