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Identifying, measuring, monitoring, and managing multinational risk is a complex and continuous process due to the ever-changing nature of the international insurance marketplace and regulatory requirements. During a recent edition of Marsh's Webcast series, The New Reality of Risk, a panel of experts presented a range of information to help inform organizations' strategies and plans for optimizing portfolio diversification and multinational program structuring, as well as program placement design to include the global market hubs. The panel addressed some of the many questions related to achieving a state-of-the-art multinational insurance program — including tax and regulatory concerns.
"Multinational companies are facing a barrage of regulations that affect their global operational activities — corporate governance rules, stringent local licensing laws, changes to director's responsibilities, and more," Praveen Sharma, global practice leader of Marsh's Insurance, Regulatory and Tax Consulting Practice, said during the Webcast.
"Consequently, multinational companies are keen to implement insurance programs which not only manage the groups' insurable risks in an efficient and effective manner, but that also address the insurance regulatory and tax issues."
Experts from Marsh's Multinational Practice provided overviews of insurance marketplace conditions around the globe:
- There is ongoing interest from insurers to enter Eastern European markets, said Oliver Kubale, of Marsh's Dusseldorf, Germany office. He added that premium rates across Europe generally are stabilizing.
- Pricing in the Asian insurance marketplace is soft but is stabilizing, consistent with global pricing trends, said Svein Tyldum, of Marsh's Tokyo office. "Despite that, most insurers are still aggressively seeking new opportunities, and many are offering reductions on rates for most classes of insurance."
- The Brazilian insurance market is rapidly evolving following changes to its reinsurance laws, said Andrew Perry of Marsh's Buenos Aires office.
The importance of considering the global insurance marketplace was also discussed during the Webcast.
"The idea of placing an insurance program into the global marketplace can be a daunting prospect," said Mark Gregory, CEO of Bowring Marsh, Marsh's international placement specialist. "Many organizations are just used to dealing with insurers domestically. So when placing globally, it's important to have the right guidance and advice, starting with planning the initial presentations and introductions to prospective underwriters, through to executing the placement transaction, and beyond to developing partnership with insurers."
Jonathan Cook, head of risk and insurance at mining firm Anglo American Plc, stressed the importance of finding the "right insurers and the right individuals within those companies" and meeting with them regularly. He said syndicating the company's insurance portfolio has been a successful strategy.
Listen to a replay of the Webcast.
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Listen to a replay of Multinational Insurance Programs: The Optimization Imperative
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