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WTO Symposium1
Cross-Border Supply of Services: The Private Sector’s
Experience
28th April 2005
Alastair Evans, Head of Government Affairs, Lloyd’s
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Lloyd’s
A marketplace comprising 62 separate businesses or syndicates with a total premium income capacity of $26 billion in 2005.
Most risks are underwritten on a cross-border basis.
Underwriting or acceptance of the insurance risk generally occurs in a different country from where the risk is located.
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Why risks are generally underwritten on a cross-border basis by Lloyd’s underwriters
A highly developed commercial infrastructure exists already in the London insurance market to support the cross-border supply of insurance and reinsurance services.
It provides a more cost efficient method of conducting commercial business.
Local commercial presence (mode 3) is also used for the underwriting of retail and smaller value business.
The Understanding on Commitments in Financial Services.
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The benefits of liberalisation of insurance markets
The economic role of insurance.
The benefits of access by markets to commercial insurance and other financial services providers.
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Regulatory Issues
Insurance is a highly regulated sector.
Insurers are subject to prudential supervisory rules in their Home Member State.
The risk of duplicative supervision by separate regulatory authorities.
Insurers’ wish to be subject to regulatory regimes which are proportionate, transparent and neutral.
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Conclusions
It is in clients’ interests to have access to a range of financial services, whether provided locally or on a cross-border basis.
Insurance and reinsurance can play a crucial role in support of countries’ economic infrastructure.
Cross-border supply of services should be permitted, at least for large commercial risks.
