Property insurance: risks and opportunities 2007

Jane Milne

Head of Property and Creditor

New risks and oldNew/changing risks:• Climate change effects on weather perils• Public perception of insurer engagement in climate change issues• Pandemic ‘flu• Discrimination/ financial inclusion issues• Determining capital adequacy

‘Old’ risks:• The insurance cycle• Fire• Terrorism• Claims handling and effective communication with customers• Underinsurance

Climate change and other global risks

• Focussed on climate change issues, regulatory frameworks to manage risks, public spending and procurement, and links with insurers’ capital requirements

• But also includes war and terrorism risks

• And avian ‘flu and pandemics

Climate impacts• Fewer cold days and

nights• Warmer and more frequent

hot days and nights• More heat waves• More intense rainfall

events• Larger areas affected by

droughts• More tropical cyclones• More extreme high sea

level incidents

How will global trends affect UK insurance?

What are we doing about it?• Influencing UK and EU

discussions• Flood defence funding

in CSR07• A strengthened and

functional planning system

• Identifying and facilitating new opportunities to mitigate systemic risks and exploit new markets

Pandemic ‘flu

• MWE showed insurers to be in good shape generally• But possible issues on handling surge in claims• Modelling needs more consideration• ABI active on Government’s National Recovery WG

Discrimination, financial inclusion and access to insurance

• Disability Discrimination Act 1995• Discrimination Green Paper• Financial Inclusion Task Force

Not drowning, but waving!