In Oliver Wyman's report, The €200 billion opportunity: Why insurers should lend more, we examine how European insurers can capture the new opportunity in long-term funding of the real economy. The report shows how life insurers can reverse the relative decline of the last ten years and reassert themselves as leading providers of very profitable-long term financing to the real economy, as leading and vital components of the financial services industry.
The report argues that since insurers, along with pension funds, are the dominant providers of retirement savings vehicles in Europe, the predictable long-term liabilities they collect give them a structural advantage in providing long-term credit. Life insurers could fill the funding gap where banks are failing, thus increasing their aggregate market value by €200 BN or 50%. This would help to stabilize the economy, increase European insurance profitability by more than half and increase the investment return on the European work force's retirement saving.