Lloyd’s continues expansion in Asia as branch approved in India and MOU signed in China

The agreement signed with China Taiping will not only strengthen the position held by Lloyd’s in the Chinese market but, at the same time, will help Chinese companies find adequate coverage to finance their risks as they continue to expand into international markets. Lloyd’s secured R1 approval from the Insurance Regulatory and Development Authority of India (IRDAI), to provide onshore reinsurance services in India in October. This means the market is now able to set up a branch in India in 2017. Lloyd’s has been in discussions with the IRDAI since it filed its application for a reinsurance branch based in Mumbai earlier this year. This followed the IRDAI’s publication of the regulations governing the Lloyd’s market in March 2016.hideLloyd’s had already appointed Shankar Garigiparthy as its new country manager for India in April 2016. Mr Garigiparthy joined Arun Agarwal, general representative for Lloyd’s in India since 2011, and together they have been leading the development of the Lloyd’s presence in India. Lloyd’s believes its market structure will bring additional underwriting expertise and capacity to the local market and it will work with brokers and clients to “craft” policies that meet specific needs and fill gaps in the market. While the IRDAI’s new rules by no means open up the Indian market to foreign insurers and reinsurers without restrictions, the opportunity for Indian companies to access international capacity is becoming gradually easier over time. Lloyd’s chairman John Nelson welcomed the decision and supported the programme of reform being undertaken by the Indian government to open up its reinsurance market. Mr Nelson was speaking as he visited New Delhi, as part of the UK prime ministerial trade delegation. He said: “This is a very significant day for Lloyd’s and we look forward to establishing a branch in Mumbai in 2017. I believe Lloyd’s can bring unique benefits to India by providing both protection and new opportunities for many domestic insurance businesses. “India is one of the world’s greatest growing economies. I passionately believe that our presence will contribute to the development of a more diverse reinsurance market, which is fundamental to the stability and future growth of the Indian economy. This can help position India as a centre for insurance, reinsurance and associated services. “The progress India is making in reforming reinsurance markets is encouraging and will bring lasting benefits to the Indian economy. A level playing field for all reinsurers will mean that domestic market can thrive and become a hub for innovative new products that meet the need of businesses.” UK international trade secretary, Liam Fox, added: “This is a symbolic decision and one that will not only provide protection for growing Indian businesses but also bring additional revenue to the UK insurance sector. “This move is yet another example of the strong economic and commercial partnership between the UK and India – a partnership that is extremely important to me and the UK government. The bonds we share, not just of commerce and trade but also historically and culturally, will be at the very heart of the strategic relationship between our two nations.” Last month, Lloyd’s also announced that it has signed an MoU with China Taiping Insurance Group. Mr Nelson said this marked a “significant level of cooperation between the world’s only specialist insurance and reinsurance market and one of China’s leading insurance companies”. The agreement was signed by Mr Nelson and Wang Bin, chairman of China Taiping, during his visit to Lloyd’s that coincided with President Xi Jinping’s state visit to the UK. “The memorandum signifies a commitment from both sides to establish a broader and closer relationship, including deepening mutual collaboration and support for Chinese enterprises internationally – and comes at a time of increasing bilateral trade relations between Britain and China,” Lloyd’s explained. Under the MoU, Lloyd’s and China Taiping will “commit to achieve complementary and collaborative development of local and global markets”, stated the market. Lloyd’s will help China Taiping expand its global business network by supporting Taiping Reinsurance Company’s initiative to become a member of Lloyd’s and establish a Lloyd’s syndicate. The market will also support Taiping Reinsurance Brokers’ initiative to become a Lloyd’s registered broker. “China Taiping will support Lloyd’s in developing and expanding its business with Chinese interests. The two sides will also commit to sharing knowledge and expertise and cooperating on training and talent development,” stated Lloyd’s. Mr Wang stressed that the “global business characteristics are the essential part of the top priorities of China Taiping”. He described the company as a “comprehensive insurance group with the longest history in overseas operations and the richest experience in internationalisation among the state-owned insurance enterprises”. Mr Wang added: “[The] establishment of the cooperative relationship with Lloyd’s is a significant strategy for China Taiping to elevate its internalisation, build its industrial chain, strengthen its reinsurance business capability and expand [its] overseas business network. Through the cooperation with Lloyd’s, China Taiping will further integrate its resources in both domestic and overseas markets, in direct business and reinsurance, in renminbi and foreign exchanges, in P&C and life insurances. Furthermore, China Taiping will improve its ability in the implementation of Chinese enterprises going global and the Belt and Road Initiative.” Mr Nelson described the MoU as a pledge of Lloyd’s’ “commitment to building a strong and lasting business relationship in the future”. He pointed out that Lloyd’s has been the global hub for specialist insurance and reinsurance for centuries and by seeking out new business partners and further “internationalising” its capital base it would “reinforce” its global position. “China is an important part of Lloyd’s future strategy and this [MoU] will enable us to deepen our understanding of the market and improve the support we are able to provide, as well as having the mutual benefit of sharing respective knowledge and expertise,” said Mr Nelson. Lloyd’s added: “The strategic and cooperative relationship set out in the memorandum will support the risk management of Chinese companies looking to expand internationally. It will help Chinese insurers and reinsurers to tap into global markets and give them access to expertise from different locations.”

Lloyd’s continues expansion in Asia as branch approved in India and MOU signed in China

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