Insurance industry told to stand up and prove its worth amid emerging risk threat

The director general of the Association of British Insurers (ABI) has said the industry has been present with the opportunity to highlight the value it brings to the global economy as it seeks to tackle a range of “mega risks”.

Hannah Gurga was speaking at the Association’s annual dinner  in which she launched the organisation’s three year strategy which will seek to put insurers at the heart of protecting the planet and its population.

“It is by working together that we can drive the security, stability and growth that we need in this country,” she said. “In that spirit, we want to work together to create the legal, regulatory and tax framework that unlocks the full potential of our sector. We need a tax regime that is fairer and internationally competitive. A legislative framework that supports growth and a building safety and planning regime that ensures the resilience of our communities.

“Many of the future challenges we face demand closer collaboration between public and private sectors. Healthcare, financial resilience, climate change and cyber security. These are all areas where our sector has much more to offer. As an industry, we are ready to forge a new era of partnership. A trailblazing new alliance in the national interest, to build our resilience to the risks of tomorrow.”

She added changes to the UK’s solvency regime are set to unlock billions which can be used by the industry to further their support for the economy.

“The investment power of our industry is already a cornerstone of the infrastructure across our country,” Gurga continued. “We finance the regeneration of brownfield sites, we build affordable housing, and we are already helping drive the transition to Net Zero.

“Our investments create thousands of jobs and enhance the lives of thousands of families. And we’re only just getting started.

“The new Solvency UK regime could, over the next 10 years, unlock over £100 billion of investment from our sector. Enabling us to finance more projects that deliver an outsize return to society while maintaining the high levels of protection that policyholders – rightly – expect.”

She concluded: “We are not a fair-weather friend. We take care of those struck by disaster. We take care of those who lose their jobs. We take care of those who have fallen ill. And we help people take care of themselves when they retire.

“This industry, does more than any other to make our society more resilient, more secure and more compassionate.”

The ABI’s strategy highlight to opportunity the changing risk landscape delivers for the industry.

“We face geopolitical uncertainty, regulatory change, rapid innovations in technology, and new types of ‘mega risks’ which jeopardise national and individual resilience,” it stated. “These present challenges that in some cases cannot be met by government, industry or a single business alone. But challenge also provides opportunity. And our sector has a huge opportunity to work together to drive change.

“Opportunity to use technology to innovate and provide new products that better meet the needs of customers. Opportunity to use regulatory change to unlock investment in a broader range of productive assets under Solvency UK. Opportunity to build public and private partnerships that drive use of preventive healthcare, meet the challenge of climate change and prepare for future systemic risks.

“In this world, our industry must work together. To meet the challenges and seize the opportunities – to drive change for the benefit of consumers, the economy and wider society.”

Gurga, explained: “Our new purpose and strategy set the direction for the ABI, bringing together key stakeholders and partners to drive positive change for our members, customers and wider society. Our industry is uniquely placed to support society, the economy and our planet. We stand ready to forge a new era of partnership between business and the state to tackle the long-term challenges we face, and as we seize the opportunities to protect and build a thriving society.”