January 25, 2010

WORLD: Aviva chief to promote welfare role for private sector in talk at Davos

. LONDON, England / The Times / Business / January 25, 2010 By Miles Costello Insurers should work with European governments to negotiate a greater role for the private sector in welfare provision and funding long-term healthcare, Andrew Moss, the chief executive of Aviva, believes. Mr Moss, who runs Britain’s biggest insurer, will tell financial leaders at the Davos summit this week that the sector is well placed to offer the kind of affordable savings and retirement policies that could be used to top up existing state provision. This would help to ease the growing burden on government finances across the Continent, he will say. Andrew Moss, chief executive of Aviva. He recently made clear that the insurance company would defend its position as the UK’s market leader in the face of an acquisitions drive by Resolution. Richard Pohle/Times Newspapers Ltd Mr Moss will support an initiative, recently floated by the Conservative Opposition in Britain, for insurers to offer low-cost savings products that would help to pay for healthcare provision for the elderly. The Tories have outlined plans for an insurance-backed scheme that would cost about £8,000 per person. As chairman of the Treasurycommissioned Insurance Industry Working Group (IIWG), Mr Moss argued that the private sector could shoulder some of the responsibilities of the welfare state in the UK. The IIWG found that, by selling illness and unemployment policies, insurers could take on £17 billion of the state’s welfare costs. Related Links Asia's rise creates new world order The Man from the Pru is bullish on Asia In an interview with The Times in advance of the speech he will make in Davos, Mr Moss said that European insurers could do the same. “The economies of, say, Spain or Ireland are experiencing exactly the same debates about fiscal deficits. I’m going to be making those points [raised by the IIWG] about all the markets we operate in,” Mr Moss said. This is the third year that Mr Moss has attended Davos but the first time that he will speak. “It is extremely important for the chief executives of the world’s largest insurers to have a presence and to participate, particularly when it comes to issues of regulation,” he said. The Aviva boss said that he would be using Davos to try to tackle some of the long-term issues that have plagued the insurance industry, such as how to encourage a retirement savings culture, improve financial literacy and restore consumer confidence in the financial sector. “Wherever we look we are under-saved and underprovided for in retirement income. There are macro issues about partnerships with government. Governments and the industry have to engage in a debate about how to address these problems over a five to ten-year period,” he said. Aviva is the world’s fifth-largest insurer and operates in 28 countries.[rc] Copyright 2010 Times Newspapers Ltd.