Trend of protectionism a bigger worry than election result
While the US election will inevitably dominate conversations at industry conferences at the moment, the rhetoric should focus less on the person being elected and more on the trend prevalent in the US and globally of protectionism and nationalism.
That is the view of Ingrid Carlou, chief executive, Patria Re, the Mexico-based reinsurer, who said she fears that the world is entering a phase where protectionist policies will become increasingly accepted.
“With the elections in the US coming up, I believe it will be an unavoidable subject of conversation. But, whatever happens as we approach election day, the conversation should not centre on the person being elected but more on the tendency we are seeing—not only in the US but worldwide—in terms of protectionism, populism and nationalism,” Carlou said.
“An idea sustained by many is that the world operates in waves of 30 years. In that context we saw the Thatcher era, the globalisation era—what is next? Will it be a technological era or a national-protectionist wave?”
Carlou said she believes that technology and science will continue to evolve in the coming years but the question is how rapidly these developments will permeate into society and the economy.
She believes there are unresolved questions that need to be addressed, many of which have to do with human wellbeing more than technology.
“There are some simple questions such as, if what makes a human being human is the capacity to decide, then what is the future of humans once computers acquire the capacity of deliberation and decision-making?”
But, she added, there is also a very high possibility that the next wave of the integration of technology will be delayed by “a protectionist wave looking for a space to resolve a number of human, social and ethical problems that need to be addressed before we jump into the fourth industrial revolution,” Carlou said.
For Patria Re, she said, it is business as usual in the context of the company’s continuing to diversify and grow. At the end of 2015, it launched a Lloyd’s special purpose syndicate in partnership with Ironshore via its Pembroke Managing Agency.
Patria Re SPS 6125, which has an approved stamp capacity of £15 million ($18 million), underwrites a portfolio of short tail exposures for Latin American specialist lines of business.
She said the company is now focused on integrating its new operations while continuing to increase the relevance of the company to clients.
“In the last few years we launched a number of projects related to geographical diversification, expansion of the specialty lines, proximity to our markets and appropriation and deployment of new products and services. These activities need to consolidate and become second nature to our operation as we enhance the relevance of the company,” Carlou said.
“The crusade for relevance is fundamental in a world of great transformation. We believe a plural community of people committed with their surroundings is required to surmount the challenges ahead. We move forward with this larger project in mind, while consolidation of the industry increases and the market remains soft.”
Carlou said the Lloyd’s syndicate is proceeding as planned and she expects to close the year reasonably within budget thanks to no major losses, conservative underwriting and strict adherence to underwriting guidelines.
“It has been a year to test the waters. We have had the chance to really discuss things with Pembroke, our host and managing agency; we have also had the opportunity to better understand Lloyd’s, its expectations and modus operandi, as well as its rules and regulations. I would not say we are becoming locals but we are learning the game,” she said.
