Amid increased demand for tailored investment services, Willis Towers Watson has enhanced its proposition for insurers – moving its UK insurance investment solutions group (IISG) to the brokerage giant’s insurance consulting and technology (ICT) UK life business.
The IISG, which caters to both property & casualty and life insurance companies, provides services such as asset liability management, internal model validation, and investment management organisational design. It has now been transferred to ICT, whose consulting services assist in managing risk and capital, improving business performance, and creating competitive advantage.
“While ensuring the IISG retains its unique offering and close links with the investment business, transferring to the ICT business will offer tighter integration of our insurance and investment capabilities, driving efficiencies in the service and the ability to uniquely develop Willis Towers Watson’s investment proposition for insurers,” said IISG head Keith Goodby.
The move took effect on Easter Sunday and is an addition to ICT’s current operations in 35 markets.
Meanwhile Willis Towers Watson cited a highly regulated, competitive, and low-return environment. It said there is growing clamour for better asset allocation aimed at raising investment yields.
Among the “persistent” factors driving demand are regulatory developments like MIFID II and PRIIPs, which Willis Towers Watson noted are increasing the complexity of investment management for insurers. In addition, risks are said to be skewed to the downside over the medium term.
According to the advisory firm, Solvency II and Prudent Person Principle have also necessitated a deeper understanding of requirements for the management of assets and investment risk. More volatile outcomes have surfaced, as well, due to global linkage of markets through technology.
“Insurers are grappling with a continued low-yield environment and shifting regulations, driving changes to their asset strategies, business models, and risk appetite,” explained Marcus Bowser, sales & practice leader, UK life consulting at Willis Towers Watson. “While these changes have created some obstacles for insurers, they also represent an opportunity to consider how best to enhance their returns in a risk-controlled and capital-efficient way.”