There’s more good news for insurers. Not only has the new City Minister revealed that the government is pushing ahead with plans to reform the hotly contested Ogden rate – Steve Barclay has also shared positive developments regarding insurance-linked securities.
A Financial Times report said the recently appointed economic secretary to the treasury has assured that these securities – which connect investors to insurance buyers – will be introduced in Britain. According to the report, the UK has missed out on the $75 billion business previously for lack of regulation.
“The regulations are now being finalised so they can be laid in parliament before the summer recess, with a view to the regime coming into force in the autumn of this year,” said Barclay in a letter to the London Market Group (LMG).
Malcolm Newman, chairman of LMG’s task force on insurance-linked securities, described the move as a “great example” of finding ways to innovate London’s leading position in the world of risk transfer. “We hope this partnership with government sets a strong precedent for other initiatives,” Newman was quoted as saying.
A Reuters report, meanwhile, said a total of $5.8 billion worth of catastrophe bonds – a type of insurance-linked securities – were issued last year, according to broker
Aon Benfield.
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