London still provides home for risks that cannot be placed elsewhere

 London Market Group CEO Caroline Wagstaff writes exclusively for Emerging Risks on why London needs to make change happen in its fight for talent in order to keep its position in the global market.

In late May 2024, the latest set of data about the global position of the London insurance market was published by the London Market Group. It illustrated powerfully once again that London is a genuine world leader in commercial (re)insurance, providing unmatched expertise and innovation; creating products that keep the wheels of the global economic machine moving forward and enabling investment in new technologies, exploration and research.

London’s historic dominance in specialty re/insurance and its ecosystem of risk transfer expertise means that it attracts capital from around the globe, and in fact over 80% of that capital is foreign owned. The London Market is an essential home for investors with an appetite for insurance risk because it provides access to the entire global market and the broadest choice of risks.

In 2022, the market earned $159 billion in GWP, with nearly three quarters of this income coming from outside the UK. In total 68% of the London Market’s business came from companies outside the UK and Ireland, based on gross premiums by insured location.

Many buyers come to the London Market having found that domestic insurers do not have an appetite for their risks because those risks are unique or unusual. For others, London can offer a better price.

Since the  departure of the UK from the European Union, the London Market continues to underwrite risks within the European Union just as before, but inevitably there have been changes in how it operates post Brexit; and this has led to a reduction in the amount of business generated from Europe – it now accounts for 10% of the market’s income, down from 12% in 2020.

The 350 insurance businesses in the London Market employ nearly 60,000 highly skilled people in London and across the rest of the UK and make an economic contribution to the UK economy of £49 billion every year. This unique ecosystem offers an unrivalled breadth of expertise and unique concentration of knowledge and experience. This drives creative solutions to existing and emerging risk transfer problems – both in traditional industries and in newer, fast-growing economies and technologies.

There is however a shadow over this incredible pool of talent and that centres on the issue of an ageing working population. There are as many people over 50 as under 30 in the London Market – a higher percentage than in other parts of financial services, which means that at a firm and market level we need to be accelerating our efforts to make specialty insurance a destination career for young people.

2024 has seen an acceleration in our work to do just that. We have extended the reach of the London Insurance Life website; widening the roles we highlight to include claims and increasing the number of role models – both school leavers and graduates – that we profile. We have also significantly increased the number of entry level roles and programmes being advertised on the site.

We have also committed more resource and energy to generate traffic by highlighting the material in the channels in which young people gather – social media! (TikTok, Instagram and LinkedIn.)  Topics have been driven by the interests of our viewers and range from ‘how do you get a good CV?’ to a post about risks in a football match, which got 1,000,000 views in the first 24 hours. We have made our own content, worked with influencers and even had a cat video!!

But we have seen real results with our schools outreach programme. In 2023, we placed 115 students in 30 market firms for work experience. One-third of our participants applied to come back in the autumn for our second new event: the Apprentices Discovery programme, where 20 firms who were hiring for apprentices met students in a careers fair. So far, eight of those students have found jobs in the market – a career that they had not heard of 12 months ago. This summer we will host 150 students!

These are however just the beginnings. To succeed we have to keep going, every year our target audience is completely refreshed and we have to start again. I am delighted that the market seems keen to do this.  It seems we have all learned that we can make change happen on talent, but to do so we have to work together and commit to this for the long term. Hopefully with this work in progress, as we come back to the London Matters data in future years, we will see the shift in the market demographic that we are seeking and which ensures that our future talent pipeline remains strong.

The 350 insurance businesses in the London Market employ nearly 60,000 highly skilled people in London and across the rest of the UK and make an economic contribution to the UK economy of £49 billion every year.