Gabriel Makhlouf: Insuring for our future

Remarks by Mr Gabriel Makhlouf, Governor of the Central Bank of Ireland, at the Insurance Ireland's Annual Industry Lunch, Dublin, 16 June 2022. 

The views expressed in this speech are those of the speaker and not the view of the BIS.

Insuring for our Future

Good afternoon, it is a pleasure to address you today.

A well-functioning insurance market provides important benefits and supports for society as a whole.

Insurance protects people from financial loss, should unforeseen events arise.  At a macro level you have an important role in channelling savings into financial markets and ultimately the real economy.

In my remarks today, I will first discuss the role the insurance sector plays in the economy and in the financial system.  I will then give our assessment of how the insurance sector is doing in Ireland before concluding with some current areas of focus and reflections on longer term trends.

Insurance and the economy

Insurance enhances the efficiency and growth of the economy. It allows businesses to transfer risk, which facilitates funding. The sector pools and smoothens aggregate risks.   Moreover, the dissemination of information on the price of risk should lead to more efficient resource allocation. The sector also plays an important role in channelling household savings into financial markets and the real economy.

This happens on an international scale.