The time between Christmas and New Year at Casa Croft is dedicated (in the loosest possible definition of the word) to thoughts of the New Year to come. How will the world’s greatest trade association square up to the challenges 2024 will throw at it? How can we and our plucky band of followers we like to call members continue to punch above our weight and remain the linchpins of global economic growth that we have always been?
In the end, all of this advanced thinking, distracted as it is by frequent flicks through the prospects for the January transfer window and the latest machinations of the correspondents of Dear Deirdre, will be distilled into the LIIBA agenda for 2024. This much anticipated annual publication will be coming to you on or around January 11. Spoiler alert: I do not intend to spoil the surprise by revealing our detailed plans here, ahead of the main date. But, given the time of year and my well-established track record in this column of outstanding predictions, it might be fun to explore some of the themes that will drive our work.
Our global industry will always be buffeted by the gales of geopolitics. Perhaps the most over-quoted fact about 2024 is that more people will go to the polls next year than ever before – mainly because there are elections in India. While these are unlikely to significantly open up what is one of the most sought-after insurance opportunities, developments elsewhere could make a change to how we operate.
Unless something truly remarkable happens then Claudia Sheinbaum, the anointed successor to Andres Manuel Lopes Obrador, will become President of Mexico in June. Here is a nation with insurance penetration of just 2.3% that is about to be governed by a climate scientist with a partial claim on a Nobel prize who is seeking private investment in her renewable energy programme. Sounds like an insurance opportunity to me. And, if the energy programme addresses private sector concerns about Sheinbaum’s MORENA party, it could also trigger the anticipated “nearshoring” of US industrial supply chains from Asia. And what about that will not need access to global insurance capacity?
North of the border things may not look so rosy. A second Trump administration is likely to prove yet more protectionist than the first. Our major market turning in on itself may not be ideal. But how likely is it to happen? At national level, Trump has a lead of in excess of 50 percentage points over any rival for the Republican nomination.
But, as Hilary Clinton found out to her cost on her two runs for the presidency, neither the race for your party’s nomination nor the election itself is a national poll. It is a series of local contests. And, at that level, there is potentially a coming force in the Republican race. Nikki Haley, despite her confusion over the causes of the Civil War, is now running clear second in New Hampshire and South Carolina and is catching Ron DeSantis in Iowa, three of the first four states to choose their candidate. Were she to consolidate this, she could emerge from South Carolina as the sole anti-Trump candidate left standing. And from there, who knows? There are genuine electoral reasons why she might become the preferred choice. Both at (irrelevant) national level and in key battleground states like Pennsylvania, Trump leads President Biden in polls but only within the margin of error. Haley leads by nearly five percentage points. She is a better bet if winning the White House is the main consideration. And a President Haley, while hawkish on China, Russia and North Korea, might prove more liberal generally towards international trade than Trump. That could be good news for our market.
Plus, lest we forget, unless the Prime Minister runs it absolutely to the wire, we will have a general election in the UK this year. While the major progress we have made via the Financial Services and Markets Act in seeking a more proportionate regulatory regime is likely to be untouched by the outcome, it might be that a friendlier looking government in Westminster will soothe relations with the European Union that are still an impediment to our members servicing their clients. Well, it is the New Year. One is entitled to dream.
Away from politics we have been carrying out a strategic review of LIIBA’s offering – validating with members that the services we offer are the services they want. This might lead to some adaptation to the way we are organized, to reflect the challenges the market faces over the coming period. So, watch out for more detail on that. And we cannot ignore the creeping progress of artificial intelligence and the impact that might have on our industry. We have some interesting ideas as to how we might explore this issue a bit further.
So, there you go: a preview of the preview. By the time you see the real thing on January 11, I may well have had to distance myself from many of the predictions made here, if past performance is anything to go by. But the gist will remain the same. 2024 is going to be another big, unpredictable, risky year. And that makes our role as the global mitigators of risk all the more important. At the centre of the issue and central to the solution. Just how we like it.
