March 17, 2011

With the dials on the Japan Quake claims estimate totalizer spinning faster than Peter Mandelson in a tumble drier, it takes a level head to focus on the fundamentals of the global insurance business. One like that surmounting the neck of Lloyd’s deputy chairman Graham “Chalky” White, who reminded delegates at Qatar’s fifth annual MultaQa conference this week that “Insurance isn’t banking.”

Like someone visualising an elderly relative in the hope of prolonging the sexual act, denizens London’s major insurance broking houses are focusing on the human misery of those caught up in last week’s quake-tsunami-nuke triple whammy in a vain attempt to avoid hissing like overexcited pressure cookers at the glorious prospect of rising rates and hence commissions.

At times like these, it takes a practical man to remind us that low rates – along with meddling regulators and measley investment returns –are one of the major challenges facing insurers today. “We must ensure we are regulated as insurers, by people who understand the needs of the insurance community,” White insisted. Perhaps some kind of self-regulation would do the trick.

“Mutton never tastes quite as good as lamb,” he reflected ruefully by way of allusion to the fact that brokers should make sure their insurance buying clients understand they’ll get what they pay for and should focus on security not price and thus allow insurers to charge a bit more for the cover they offer. After all, he reminds us, the property and casualty (re)insurance industry has made an annual underwriting profit only five times since 1975 – hence the notable poverty of its senior practitioners in comparison with those bloody bankers who get away with murder.

In an uncharacteristic lapse into crass genderism, White said he found it “very disappointing” that the European Court of Justice has ruled out discriminating on the basis of sex. “Motor insurers,” he lamented, “will no longer be able to quote a higher premium for young male drivers than for young female drivers – even though the latter pose a higher risk.”

You can’t say things like that, surely!


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