NU Online News Service, June 17, 2:56 p.m.EDT

Changes in the global economy, particularly in developingnations, present significant opportunities for the insuranceindustry as the global middle class expands and insurance needsgrow, according to Willis Group’s chairman and CEO.

In a transcript of comments delivered by Willis executive JoePlumeri at the Insurance Day Summit in Bermuda on June 14, he saysestablished economic powers in the developed world will facechallenges going forward, while developing economies in Asia andthe Middle East will see an explosion of middle-class growth.

For the developed nations, Plumeri focuses on the U.S., where hesays opportunities will emerge for private insurers as publicinsurance options are re-evaluated. He explains that there isalready talk about scaling back the Terrorism Risk Insurance Act of2002, there is no political will to take coverage for catastrophessuch as tornadoes out of the private sector, and the U.S.government “seems to be realizing that the National Flood InsuranceProgram is unsustainable.”

“As the industrial world undergoes reform,” Plumeri says,“opportunities will emerge for our industry.”

But, he says, even greater opportunities exist in emergingeconomies such as BRIC (Brazil, Russia, India and China)nations.

Plumeri says the Financial Times reported that pent-up demandfor new housing in Asia and the Middle East is “staggering,” and headds that Goldman Sachs predicts that two billion more people willjoin the middle class by 2030 around the world.

“This will create demand for all types of insurance productsfrom life and health to marine and aviation to professionalliability to all types of property and casualty for both personaland commercial lines,” Plumeri says.

Brokers will also have opportunities as the emerging middleclass seeks out advisers that understand them and their industries,Plumeri notes.

Plumeri concludes, “This new middle class is going to buildcities, transform agriculture, build factories, insure lives, buyhealth insurance, ship raw materials, fly, buy boats, consume allsorts of goods and sue each other. They will want to insure all ofit.

“And we’ll be there to help.”