Insurers face a myriad of challenges at the moment in what is a demanding market environment. Intelligent Insurer speaks to the team at Barclays about some of the potential solutions to these problems.
Discussions at this year’s Monte Carlo Rendez-Vous will focus heavily on the varied challenges insurers currently face. A challenging banking environment and poor investment returns, coupled with a generally flat market, mean insurers are scrambling to find new ways to remain profitable.
One of their biggest challenges is finding a use for their short-term cash that will also generate a return on those assets. Carl Boulton, head of insurance, Corporate Banking, at Barclays says the huge balance sheets insurers have can make this task difficult. He suggests using a specialist. “We can provide support through a variety of products from basic overnight treasury deposits, working capital to bespoke deposits based on a physical bank current account and aligned to the client’s needs,” he says.
A recent spate of downgrades within the European banking sector has also highlighted the risks insurers take when choosing counterparties to work with. Finding sufficiently rated financial institutions is not easy in this market but, on top of this, if banks are downgraded, their new rating may fall below the threshold set by the insurer’s treasury policy.
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Reinsurance, Insurance, Capital management, Corporate banking, Barclays