Seeking a safer haven
Bankers’ bonuses totalled £11bn in 2007, at the top of the longest uninterrupted economic boom for a generation. But by 2010, they’d fallen 36% to £7bn during what have become the austerity years.
But despite the highs and lows, mid and high net worth insurance markets have continued to grow. The change has been in how the rich choose to invest their cash, rather than a lack of spending.
After the initial shock, the pre-crisis culture of showy wealth gave way to more conservative investment decisions. Gold, vintage cars, and even Penny Black stamps began to attract buyers as the rich looked for safer bets for their cash. Financial paper was shunned.
This economic conservatism led to fine art and antiques becoming more popular, meaning a rise in the value of sums insured for home contents.
Post-crisis sentiment also saw the rich become more cautious in terms of wanting the safety net of a well-fitting insurance policy.
Zurich Private Clients head Matthew Schofield says: “From a customer perspective, there is conservatism. There’s still an amount of growth in the market, but it’s how they’re spending their money. There are fewer yachts being sold, supercars and high-end vehicles. They are heading to safety: old masters, furniture, sculpture.”
Zurich Private Clients is looking to the Middle East and other overseas markets for growth. Schofield says: “We have ambitions as a global brand.”