New York Insurance Exchange
Actually this is not the first time New York State wants to do this, New York State set up an exchange in the 1980s as a centralized marketplace for brokering and underwriting, was founded to great fanfare but later closed its doors after the industry was hit by a severe period of losses. In its present attempt the New York Insurance exchange plans to allow underwriters to form syndicates to reinsure, and insure unusual or very large exposures. The State of New York is forming a working group to set out exactly how the exchange could operate, has already tapped the views of a wide range of industry participants including both U.S. and foreign insurers, some of the major insurance brokerages and possible investors.
This opens up an interesting chapter in the global insurance trade, If the present attempts by New York is successful it could become a formidable competition to Lloyds and also result in creating healthy competition between the various entities and if successful could also open up the clamor to open more such exchanges. Lloyds writes about 44% of business from US & Canada and if we include South American business as well Lloyds writes about 50% of its premiums from Americas. That’s just about US$ 10 Billion of Gross written premium that is crossing Atlantic to the UK today.
The trend could be a blip or become a wave if New York Insurance Exchange succeeds in its attempt but holds wide felt ramifications & opportunities for suppliers who can tap into help New York Insurance Exchange as a potential service provider. Even if the NYIE picks up 10% of business from Lloyds or simply picks up the additional growth that Lloyds has been seeing in Americas the Exchanges at the right competitive potential could start at about US1 to YS 2 Billion of premium income a year.
Obviously it is still a long way to see how this materializes into reality and what could be the actual performance of such an exchange. Also various waves that came to hit Lloyds in the past including the Captive offshores, Smaller insurance exchanges and ART schemes have all enriched Lloyds growth and has furthered it to grow bigger and better, it would be interesting to watch how this turns out to be!
This opens up an interesting chapter in the global insurance trade, If the present attempts by New York is successful it could become a formidable competition to Lloyds and also result in creating healthy competition between the various entities and if successful could also open up the clamor to open more such exchanges. Lloyds writes about 44% of business from US & Canada and if we include South American business as well Lloyds writes about 50% of its premiums from Americas. That’s just about US$ 10 Billion of Gross written premium that is crossing Atlantic to the UK today.
The trend could be a blip or become a wave if New York Insurance Exchange succeeds in its attempt but holds wide felt ramifications & opportunities for suppliers who can tap into help New York Insurance Exchange as a potential service provider. Even if the NYIE picks up 10% of business from Lloyds or simply picks up the additional growth that Lloyds has been seeing in Americas the Exchanges at the right competitive potential could start at about US1 to YS 2 Billion of premium income a year.
Obviously it is still a long way to see how this materializes into reality and what could be the actual performance of such an exchange. Also various waves that came to hit Lloyds in the past including the Captive offshores, Smaller insurance exchanges and ART schemes have all enriched Lloyds growth and has furthered it to grow bigger and better, it would be interesting to watch how this turns out to be!
