The London 100 white papers provide exclusive research and comment on areas affecting the London and international (re)insurance markets. Like the London 100 itself, the papers are designed to be informative and thought provoking and are produced in collaboration with The London 100 partners.

Solvency smart - Turning an internal model to your advantage

CEOs across the London market have long been asking whether there will be sufficient benefits associated with Solvency II and the internal model to justify its considerable costs.

We believe a well-embedded internal model can provide more insightful management information and fundamentally change the way companies do business for the better. Businesses can create real competitive advantage from their internal models, thus realising significant commercial gains from the costs incurred. Here's how. In association with Ernst & Young

Click image to download

The currency effect - Tumultuous times

While insurers have dedicated considerable time and resources in preparation for Solvency II implementation, the financial markets have continued to remind treasurers of the impact of market risks on both profits and balance sheets.

This year has continued to witness bouts of heightened market volatility, with currencies, in particular, fugacious to stability for prolonged periods, against the backdrop of persistently ultra-low interest rates and stubborn inflation eroding asset returns.In association with Lloyds Bank Corporate Markets

Click the image to download

A question of balance

Regulation is there for a purpose. When created and implemented effectively, it provides consumer protection and market stability, combats corruption and promotes transparency and competition. However, many would argue that government intervention has become increasingly frequent and intrusive in recent years, to the detriment of businesses' ability to operate effectively. In association with Ince & Co

Click image to download

Claims and recoveries - Political risk and trade credit

The private, as opposed to state-sponsored or multilateral, political risk insurance (PRI) placed in the London insurance market comprises, in its wider definition, cover for losses caused to investments and projects by government confiscation, expropriation and nationalisation (CEND), and insurance against contract frustration or repudiation by government obligors (CF).

More recently, structured trade credit has been insured against both political risks and straightforward counterparty default (CR or TCI). Cover may also be provided for losses caused by political violence (PV), including terrorism. In association with Ince & Co

Click image to download

Market risk - Investment outlook

Increasingly volatile markets and low investment returns mean that non-life insurers face some of the toughest financial market challenges for a decade. In addition, the approach of Solvency II (SII) for European insurers means that new systems and approaches to solvency capital will emerge.

In this update we explore some of the market risk challenges facing insurers across foreign exchange (FX), interest rates, inflation, and credit markets and at how established hedging strategies may become more common in helping to manage economic capital. We also explore
the outlook for interest rates as insurers face significant pressure on investment income in the new environment, as well as how floating rate note strategies can help insurers to increase returns. In association with Lloyds Banking Group

Click image to download

Intra-group reinsurance - Outlook: unsettled

Intra-group reinsurance is a key strategic pillar in the underwriting strategy and capital structuring policies of many insurers. However, there are a number of potential changes taking place around the world that, if implemented, will impact many existing related party reinsurance structures and require companies to re-visit their approach. In association with Ernst & Young

Click image to download

Sponsored by