Fishing For Growth – Why The Insurance Sector Is So Strategically Important to The UK
The City of London is the oldest continuously-running local democracy in the world. The Square Mile is run by 100 Common Councillors and 25 Aldermen, elected by workers and residents across the City. I am proud to announce to all of my contacts within The City of London and beyond that I will be standing for election in March 2025 in Billingsate Ward with Julie Tucker of BE Offices, also a fellow member and active user of Kmend, and a leader in corporate ESG strategy and delivery within the Square Mile. If you are a business within the Billingsgate Ward in the City of London, do please ensure you are registered to vote as soon as possible by visiting www.speakforthecity.com to update all of your details!
Billingsgate Ward is primarily an insurance district. The Ward is one of 25 Wards within the City’s Square Mile and is situated a little way east of Fish Street Hill and Pudding Lane. Businesses in the ward come from multiple sectors such as insurance, banking, management consulting, IT/technology, hospitality, retail, livery companies and charities, but insurance is by far the dominant industry with multiple large insurance companies situated in modern, state of the art office complexes in Minster Court and 30 Fenchurch Street to name two of the largest blocks.
So what does the City of London Insurance market look like and why is it so strategically important? The UK is home to the most dynamic and innovative insurance market in the world.
The UK had a £17.4bn trade surplus in insurance and pension services in 2022, one of the largest surplus of any of the world’s major insurance economies. The London Market contributes 32% of the City’s GDP. It also employs nearly 60,000 people – the second largest workforce in the City after banking. UK-based insurers hold £1.5 trillion (trillion!) in assets. Its commercial specialty (re)insurance market – the London Market – is the largest globally and the destination of choice for mitigating and managing complex risk.
London’s reach enables it to serve insurance needs in any location. Close to 70% of the London Market’s premium is sourced outside of the UK.
The London Market is home to the world-renowned Lloyd’s of London as well as over 350 brokerage and insurance firms, offering companies flexibility and choice. The London Market’s world-leading expertise and deep pools of capital mean it is capable of insuring a wide range of established and emerging risks. For more than a century it has been providing protection against climate-related risks. It has since expanded its offerings to include risks related to AI, cybersecurity, geopolitical events, and supply chain management.
Look at the figures – US $159bn of premiums are written by the London Market, the largest global hub. 43% of all aviation, energy and marine insurance worldwide is provided by the UK market. London is the only place where every top 20 insurance and reinsurance firms has a presence. 8% of the total global (re)insurance market was controlled by the London market in 2022, making it the largest underwriting centre in the world.
With nearly 600 cybersecurity product and service providers, London has a unique concentration of cybersecurity and underwriting expertise which makes it a natural hub for cyber risk.
Across the world, there is a significant level of uninsured risk in the event of extreme weather. The London Market offers solutions for climate risks that many domestic markets are unable to insure.
Rising geopolitical uncertainty is exposing businesses to increased risk. London is the only market place with the appetite, knowledge and experience to take on global geopolitical risks at scale.
Global supply chains are complex and opaque. The London Market’s deep knowledge of areas like marine, aviation, and energy risk make it uniquely positioned to insure against supply chain risk. AI brings both benefits and unforeseen risks. The London Market’s access to a sophisticated tech ecosystem ensures it can expertly underwrite these risks and use AI tools to increase productivity.
By promoting, supporting and understanding the needs of the sector and its customers, employees, shareholders, regulators and other key stakeholders, we can ensure that it continues to thrive and support the UK as a key source of income, jobs, investment and essential services to the economy and wider society.
David O’Reilly, Managing Director, Wimbledon Park Capital
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