Ireland emerges as an insurance powerhouse

Although 700 years of war, famine, immigration and English domination began to end for most of Ireland with independence in 1922, the newly formed Irish Free State was one of the poorest and least developed countries in Europe. Today, the Irish Republic has the highest per capita GDP in the EU. It has averaged 6 percent growth over the last 20 years. How was such a turnaround achieved?

It began with the people themselves. With paltry natural resources, Ireland has always depended on the ingenuity of its people. Harnessing that resource mandated a modern educational system, which Ireland has had for more than 30 years.

Once the government introduced tax and other incentives, global companies began to notice Ireland and to take advantage of the highly skilled population. They moved many operations there — pharmaceuticals, optics, data processing, and, increasingly, financial services.

A number of advisory boards — of which DIMA is one — were established to inform companies about Ireland’s advantages and help them set up operations there. The insurance sector has been notably successful — so much so that it named its first permanent CEO in 2004, Sarah Goddard.

The Irish are not unfamiliar with the insurance industry, as the surnames of some of its most prominent leaders attest. These include: Patrick G. Ryan, who even gave his company, Aon, an Irish name (it means “oneness” in Gaelic); Brian O’Hara, president and CEO of XL; Martin J. Sullivan, president and CEO of AIG; Jerry Sullivan, chairman and CEO of E&S and reinsurance brokers G.J. Sullivan & Co.

DIMA’s membership reads like a who’s who of the world’s insurance community. Dublin is the domicile for over 200 captives as well as for the European operations of some of the world’s major insurers. It is increasingly a business center for companies like ACE, XL, Allied World Assurance, Zurich (through Eagle Star-Ireland), PartnerRe, AXIS Capital, QBE (Europe), Imagine international Re and many others. Dublin processed around $24 billion in premium in 2005.

Ireland’s success also testifies to its ability to get things done. “We’re a small country,” Goddard said, “so we can make quicker decisions. We can call up the regulators and get them together with the company in a day.”