Insurance plays a significant role in every aspect of life and business, helping to protect people’s belongings, property, health and much more against unexpected events such as fire, water, accidents, human error and natural disasters. The industry promotes investment in the future economic growth of the whole country by using the premium income received to provide long-term capital for investment. It helps to fund public services and company expansion, earn foreign currency and generate tax.
One quarter of employees in the financial services industry in the UK are employed in insurance, with 300000 insurance employees in the UK. As the third largest insurance market in the world, and number one in the EU, the insurance sector in the UK has remained strong in the face of the recession, with people keen to insure against loss. Since 2009 the insurance industry has seen a 38% increase in jobs, and 4% pay increase. Shortage areas include actuaries, underwriters, solvency II experts, regulation and IT.
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Insurance falls into four main categories:
- Wholesale – Focused on Lloyds Market Association.
- Retail – The buyer approaches the underwriter to take out an insurance policy.
- Reinsurance - Insurance companies approach other insurance companies to get insurance for their business and to protect their assets and the claims made by their clients.
- Specialist insurance -
- Credit and political risk (knowledge of worldwide political affairs is paramount)
- Terrorism/piracy (liaison with experts in the area to assess risk of insuring)
- Kidnap and ransom
- Fine art
The main types of insurance are:
- General insurance
- Life and pensions
- Health and protection
General insurance plays a vital role in the modern economy. It lets individuals and businesses minimise the impact of unexpected and unwelcome future events, and helps them organise their lives and businesses with greater certainty. The insurance industry pays out £74 million per working day in general insurance claims.
Life and Pensions
Life insurers offer valuable financial protection in the event of your early death if members of your family are dependent on your earnings, as well as a variety of ways of saving for the future. The industry pays out almost £222 million per working day in pension and life insurance claims.
Health and protection
The insurance industry offers peace of mind by providing ways of paying for private medical care for curable or short-term illness or injury. It also enables you to plan for old age and to protect your financial assets, but still pay for appropriate levels of care. There is a range of policies designed to provide a monthly income if you are unable to work due to sickness, accident or injury, until you are able to re-join the workforce.
The insurance industry has £1,139 billion invested in company shares and other assets on behalf of millions of savers in the UK and elsewhere. It accounts for over 17% of investments in the London stock market.