How insurers learned to stop worrying and love regulation: a City insurance man’s view of how the insurance market discovered the world of Basel and became a key risk partner for banks.

Add to your list(s) Download to your calendar using vCal

• David Neckar (WTW Financial Solutions)
• Monday 26 February 2024, 17:00-18:30
• John Bradfield Room, Darwin College and Zoom.

If you have a question about this talk, please contact Dr Duncan Needham.

In the early 1970s the private insurance market, led by Lloyd’s Underwriters, decided to insure foreign investments against political risks. At the time, only governments were prepared to assume these risks through state export credit agencies. The private market expanded its range of coverages during the following decades, initially focussing on political and sovereign risks, then moving into credit risks. In the first decade of the 21st century, the Basel rules regulating banks were refined and expanded in the form of “Basel II”, which opened up opportunities for insurance coverage to go beyond credit risk mitigation and to support capital management. After the Global Financial Crisis of 2008, insurers’ policies became increasingly attractive to banks, against the backdrop of higher capital requirements prescribed by the emerging Basel III regulations.

As we approach 2025, when the Finalised Basel III reforms are due to be implemented, we can see how far the banks and the insurers have travelled together, how brokers have played a key role as catalysts and how regulation has provided the framework for credit risk insurance to become a significant support for banks. A new risk transfer mechanism has emerged, almost unnoticed, though discreet commercial partnerships between City of London global insurers, banks and brokers.

This talk is part of the Financial History Seminar series.

This talk is included in these lists:

• AUB_Cambridge Seminars
• CERF and CF Events
• Centre for Health Leadership and Enterprise
• Chris Davis' list
• Darwin Lectures and Seminars
• Economic and Social History Seminars
• Economics and Philosophy
• Financial History Seminar
• John Bradfield Room, Darwin College and Zoom
• Neurons, Fake News, DNA and your iPhone: The Mathematics of Information
• history

Note that ex-directory lists are not shown.