Marks & Spencer is one of the UK’s leading retailers, with over 21 million people visiting its stores each week. The company employs over 78,000 people in the UK and abroad, and has over 700 UK stores. It has over 400 international stores in 44 territories across Europe, the Middle East and Asia. We spoke to John Windsor, Head of Insurance, Marks & Spencer plc.
Political risk and trade credit risks are high on the agenda for many organisations as political violence, terrorist threats, expropriation actions, and economic uncertainty are now the harsh realities of doing business globally. Nearly one-in-five countries experienced escalating political violence at the start of 2013, according to research from Marsh and Maplecroft. And beyond the violence and terrorism threats, global businesses face a diverse set of political and economic risks in the countries in which they operate.
Spanish insurer Mapfre is not a truly global insurer, but its dominant position in Latin America is very clear. Indeed, its operations throughout Latin America made a huge contribution to the group’s 2012 results. Mapfre announced a result after provisions and impairments of €942m, an increase of 9.6%. Premiums in Spain fell by 4.5%, but in Latin America grew by 26% to €8.65bn. The main Latin American market for Mapfre is Brazil, which saw premium growth of nearly 34%, while Colombia and Peru also saw growth in excess of 30%.
The International Monetary Fund (IMF) has reviewed Brazil’s compliance with the Insurance Core Principles (ICPs) of the International Association of Insurance Supervisors (IAIS), concluding that the insurance sector is supervised under a sound regulatory framework, but pointing to some areas where changes are needed.
The African insurance market clearly offers potential for growth, especially given the anticipated development of gross domestic product in the region, but the continent comprises 54 countries with diverse insurance markets. And as a new report from AM Best Co. explains, this reflects disparities in economic conditions and the approaches of the policymakers in individual countries and regional blocs.
In most countries in Latin America, the insurance industry outlook is stable, according to Fitch Ratings, which indicates a majority of insurers’ ratings are likely to be affirmed over the next 12-24 months. The main exception is Argentina’s insurance industry which has been assigned a negative outlook, which indicates potential pressure on companies’ operating flexibility and may lead to downgrades over the next 12-24 months. This follows Fitch’s downgrading of the country’s sovereign rating.
Strict enforcement of New Zealand Fire Services Levy, Finland increases IPT rate, Chile issues new risk-based regulatory framework, indirect tax changes round up, New regulations from Qatar’s FCRA, Nigeria’s insurance regulator on ‘No Premium, No Cover’ rule, new law enhances powers of Monetary Authority of Singapore, Kenya’s insurance regulator issues draft policies, UK’s International Underwriting Association highlights IPT rate hikes, Antipodean IPT compliance service from FiscalReps, EC issues financial transaction tax draft Directive and China issues draft notice on affiliated reinsurance transactions.
Marsh creates global Risk Management practice group, privatisation of IRB-Brasil Re moving ahead, ICISA report on trade credit insurance market and political risk insurance update from Gallagher London.
AM Best report examines captive market, Guernsey signs tax agreements with Singapore and Brazil, CICA joins Coalition for Captive Insurance Clarity, Bermuda confirms captives excluded from SII-type regime, Guernsey sees net growth of 50 international insurers in 2012 and Cayman Islands reports captive growth.
It is never easy to get feedback from individuals in the insurance industry, let alone risk and insurance managers. Not because they want to remain silent on issues, or that they don’t have something important to say, but usually because of the restraints of the organisations they work for. The dreaded ‘Public Relations’, ‘Corporate Communications’ or ‘Media Interface Directorates’ (actually I made that last one up) come into play and turn a simple quote or response to a survey into a drawn-out, time-consuming battle over what can or can’t be said.