Premium income for the London insurance market has risen by more than 7%, a new analysis published by the International Underwriting Association (IUA) has shown.
Firms covering large commercial, wholesale and specialty risks in the City earned £30.114 billion in 2021, up from £27.976 billion the previous year.
A further £5.540 billion was written in offices elsewhere but overseen and managed by London operations, meaning the overall intellectual and economic premium for the company market was £35.654 billion.
IUA says that inflationary claims pressures were a principal driving factor behind premium growth, although the year also saw increased natural catastrophe costs and companies reported strengthening market conditions across multiple lines of business.
However, the upward premium trend of the last few years does appear to be slowing with clients choosing to retain more risk, particularly in light of the COVID-19 pandemic, which had a dampening effect on the sector.
Last year, IUA recorded a 30% increase in business underwritten in the City. Although the latest figures are less spectacular they confirm our market’s continued importance as a global hub of insurance and reinsurance solutions and knowledge.
Over the past 12 months, treaty business written by IUA members has grown at a faster rate than direct/facultative placements, with the latter growing by 5.7% to £23.959 billion, and treaty jumping 15.7% to £6.154 billion.
US and Canada is becoming an increasingly important region for business written in London.
It accounted for 20% of the market in 2021, up from 19% last year, 16% the year before. Conversely, continental Europe has fallen from a 15% share to 11% which is likely due to such business now being written in EU subsidiaries.
by Yana Keller