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Insurance
Prospecting for business set to pan out
we are putting much effort into; one is very keen to have an insurance structure in Gibraltar as soon as possible”, Ashton said. “I’d like to think that an initial structure could be in place by the end of the first quarter of next year,” he added.
Callaghan pointed out: “In terms of what can be attracted to Gibraltar there are lots of very large companies that people in Europe have never heard of that are bigger than FTSE 100 companies and there are also large State- owned enterprises. As they expand, they require insurance to cover their activities in Africa and in Europe and Gibraltar is well-placed to assist with that business. “
Captives cover risk
As the Chinese buy businesses and assets, or invest in infrastructure in Europe, Gibraltar’s message in insurance is for them to think about having their own captive, with local risk management in the same time zone – people who are based in Europe, who know the local regulators and who administer the risk management of assets and operations locally.
Worldwide, there are some 7,000 captives, a form of self-insurance whereby the insurer is owned wholly by the insured, whereas in China there are less than ten captives. “Our message, working in partnership with Willis Towers Watson, the largest insurance broker in China, is that as these Chinese businesses expand it would make sense to use captive insurance in the same way as is done in Europe, USA, Australia and Japan,” Ashton declared, adding: “We hope that is a sweet spot; they appear to agree with that assessment; they think it is very interesting.”
The delay in securing Chinese insurance business is in large part down to the 19th National Congress of the Communist Party of China - embracing the Central Committee of the Polit Bureau and the Communist party – an event every 5 years – in October “resulting in a reshuffle [of officials and key appointments] internally and externally, so for the last 6 months very little has been happening [within China], and we have to have patience and wait until January”, Callaghan stated.
In January, Ashton spoke at an Insurance Society of China captive conference in Beijing where there were 250 in attendance. Guernsey Finance was also there and two months later signed a Memorandum of Understanding (MoU) with the China Insurance Regulatory Commission (CIRC)
There is quiet confidence that the efforts over two years of a local insurance professional with the support of Gibraltar Finance will result shortly in the opening of the first Chinese insurance enterprise – with several more to follow
Ray Spencer reveals
seven working days and I will keep on going there until we get their business, possibly in late 2018 or 2019, of that I am totally convinced”, he told Gibraltar International, just prior to departing.
“I think we will get business to come to Gibraltar in 2018, not just in insurance captives, but also in third party writers of business, life, pensions and casualty.”
The strength of Gibraltar’s case goes back more than 20 years when Callaghan was part of a trade mission after the fatal Tiananmen Square incident. “It was when China had effectively been excommunicated from the international world, and it was an eye opener.”
As Callaghan explained: “China brings huge opportunities. Gibraltar is beautifully positioned, because of President Xi Jinping’s
‘one belt-one road’ economic expansion initiative; Gibraltar is at the end of that road geographically. It is important to many in China to look at and explore the advantages that Gibraltar may be able to give to them and greater China as a whole. As we all know, Gibraltar doesn’t need a large amount of business to succeed.”
Mike Ashton, Gibraltar Finance senior executive specialising in insurance, concurred: “I think the Chinese business, in relative terms, can be important. Only a small slice would be significant for Gibraltar.” End October was to be his eighth trip to China in 18 months – “a pretty big investment” – and the fourth by Minister Isola in that period.
“I have got two current enquiries which
A modern vibrant city, Beijing at night
At the same time, efforts are also being made to attract EU insurers to the territory using seminars in London and elsewhere to illustrate how those European firms could use different insurance vehicles to give certainty to retaining their UK business.
The moves come in the wake of the UK Brexit vote to leave the European Union, which equally affects Gibraltar, and a realisation that most of the jurisdiction’s busi- ness is focused on Britain. The drive to broaden the range of insurance business – the largest part of the jurisdictions all-important financial services sector - beyond its pre- dominant motor policies, has given added impetus.
Bruno Callaghan, who has his own Gibraltar insurance brokerage and is a consultant to premier international brokers, Willis (which he introduced to The Rock in 1985), was at end-October making his third visit to China this year.
“I will be in China and Hong Kong for
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Gibraltar International
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