Thursday, 19 January 2012
Broker focuses on risks of Iranian nuclear plans
JLT’s World Risk Review has published its latest risk report on Iran, entitled Iran and the International Atomic Energy Agency (IAEA). The report focuses on the regime’s nuclear programme, including a detailed analysis of the country’s apparent efforts to build a bomb and the implications for the West and the Middle East region.
The World Risk Review report assesses the current state of play and introduces the complex implications of Iran's ambitions to become a nuclear power, setting out the stakes for the various parties involved, including the wider Middle East region, the US, EU, Israel, Russia and China.
Elizabeth Stephens, Head of Credit and Political Risk Analysis for JLT, said: "Iran's refusal to halt uranium enrichment, alongside recent displays of military strength in the Persian Gulf, support the conclusion of most US government officials who no longer expect the regime to buckle under the pressure of sanctions. Iran clearly perceives the benefits of becoming a nuclear power outweigh the costs."
"Though Iran appears set on its course to become a nuclear power, the environment for investors is considerably less certain. For instance, the latest US sanctions targeting Iran's central bank will effectively blacklist its investors from doing business with the US. Consequently, country economic risk and currency incontrovertibility and transfer risk remain key concerns," she added.
Brokers, analysts and the insurers and reinsurers themselves keep telling everyone that will listen that the international insurance and reinsurance industry is currently over-capitalised. But at the same time corporate risk and insurance managers complain that the industry is barely scratching the surface of its risk transfer needs and that its cost-laden, traditional line of business approach prevents it from meeting their real demands. John Charman, Chairman and CEO of Bermuda-based Endurance Specialty, believes that consolidation is the answer. He is literally prepared to put his money where his mouth is and bought a $30m stake in Endurance when he took the helm last May. He has reorganised and refocused Endurance for further growth and has now made an audacious and contested bid for rival Bermuda insurer Aspen to fast track the process. Commercial Risk Europe Editor Adrian Ladbury investigates what lies behind the proposed deal and what potential implications it has for the wider market.