Swiss Re predicts continued growth but warns of regulatory threat

clock

Swiss Re believes the insurance and reinsurance sectors will continue their "U-shaped" recoveries in 2010 alongside the major global economies.

However it also raised concerns about the looming threat of regulation from European and national authorities in a bid to crackdown on loose financial practices that could risk the fragile improvement.

Thomas Hess, Chief Economist at Swiss Re, speaking at the reinsurer's annual economic forum, said he was "a little bit more confident than a year ago."

Hess highlighted that the top 30 companies were able to restore their capital throughout the year as both insurance and reinsurance markets continued to perform well during the economic downturn.

He said: "The global economy grew in the second half of 2009, but the recovery is still fragile."

"Growth will generally be below trend in the major economies in 2010, but will accelerate modestly in 2011. Monetary policy will shift to tightening in late 2010 at the earliest, and reductions in fiscal stimulus will follow shortly afterwards."

"As a consequence, growth and inflation will be subdued," he added.

Hess also believes that given the sector's routine operation through the crisis, it should be largely excluded from upcoming regulation tightening such as Solvency II.

"Taxpayer support, as far as insurers were concerned, was confined to very few companies, and was almost entirely due to the banking type operations of these companies," he said.

 

More on Regulation

Chancellor targets FOS modernisation and FCA consultation

Chancellor targets FOS modernisation and FCA consultation

Consultation part of the advice guidance boundary review

Isabel Baxter
clock 15 November 2024 • 3 min read
PFS turmoil continues as interim CEO Don MacIntyre exits

PFS turmoil continues as interim CEO Don MacIntyre exits

Organisation has been at loggerheads with CII

Jenna Brown
clock 05 November 2024 • 2 min read
Implications of the PRA's 2025 life insurance stress test

Implications of the PRA's 2025 life insurance stress test

A regulatory shift

Sheikh Yasir
clock 01 November 2024 • 4 min read

Highlights

COVER Survey: Advisers damning of protection insurer service levels

COVER Survey: Advisers damning of protection insurer service levels

"It takes longer than ever to get underwriting terms"

John Brazier
clock 12 October 2023 • 5 min read
Online reviews trump price for young people selecting life and health cover

Online reviews trump price for young people selecting life and health cover

According to latest ReMark report

John Brazier
clock 11 October 2023 • 2 min read
ABI members with staff neurodiversity policy nearly doubles

ABI members with staff neurodiversity policy nearly doubles

Women within executive teams have grown to 32%

Jaskeet Briah
clock 10 October 2023 • 3 min read