Levene: Insurers must maintain underwriting discipline

 

Wednesday, Apr 22,2009, 10:44:08 AM   Click:

The biggest challenge facing the insurance industry today is to subscribe to a favor, and not just taking on any company for the collection of premiums, "said Lloyd? S Chairman Peter Levene.

"If anyone can do it .. [they] remain in a strong position. When people try too smart, right? S, where problems have arisen," Levene said in an interview to the management Risk and Insurance Society Annual Conference.

This is an area that has troubled Lloyd's itself in the past, "said Levene. But since the market has created a free subscription performance director, "we are in much better shape," said Levene. "It is enough to maintain discipline. You can not drop your guard."

He said that the insurance industry was in relatively good condition, despite the financial market meltdown. "But when you say that people say, yes, but what about AIG? The problem with AIG came from its financial products, not insurance. If you look at the insurance business, there is a large, operation of enterprises. "

American International Group? S Financial Products Division has been responsible for much of the credit default swaps and other derivatives which jeopardize AIG? S solvency when he was unable to respond to tens of billions of dollars in collateral calls after a series of lower rating in September 2008 (BestWire 23 March 2009).

However, insurers have been affected by the significant decline in economic activity, "said Levene.

Levene's visit to Orlando for RIMS followed by a visit to Brazil last week, where he was on hand to open the Lloyd's Brazilian office, one year after receiving approval from the leadership of Brazil's private insurance to become the first admitted reinsurer in the country.

Lloyd? S Brazil, in Rio de Janeiro, will allow unions and management agents to offer reinsurance in the country, and has two unions with a permanent local presence? Freedom and Marlborough? with a third party, Catlin, already established in Sao Paulo.

Expansion Levene said that Brazil is a big plus for us. Our business has increased by 87% compared to last year, our first year of operation. Brazil will be a good market. "

Lloyd's currently has a Best Financial Strength Rating of A (Excellent).

(By Meg Green, senior editor, BestWeek: Meg.Green @ ambest.com)


Copyright (C) 2009 by A. M. Best Company, Inc.