Justin Davies, head of EMEA at Xceedance, contributed to an Insider Engage round-up discussion about how the post-pandemic traditional London office model for (re)insurers is likely to be under extreme pressure.
Twelve months into the global pandemic and despite a “roadmap to freedom” it is clear the impacts of Covid-19 are here to stay.
Some (re)insurance industry firms have already confirmed they are going to allow working from home on a permanent basis.
According to Insider Engage, serious questions are now being posed to management boards throughout the industry. Is working from home a practical long-term solution? And if so, what about the considerable expense invested in physical offices?
Many insurers have yet to make a firm decision about their long-term stance on working from home and the repercussions. Until there is greater clarity over what the rest of 2021 and beyond could feasibly look like, more firms prefer to settle for flexible approaches.
Justin Davies offered some perspective, noting: “With significantly fewer (re)insurance firms returning completely to their offices, there will undoubtedly be plenty of unoccupied office space. Tenants will be in a strong bargaining position and I’m sure when renewing contracts, many will be negotiating for longer rent-free periods, shorter lets, and other amended conditions.
“If landlords are not prepared to be flexible, they could find themselves with large swathes of empty office space. No one can be sure how this will play out, but life and work in the City of London won’t return to exactly the way it was before the pandemic.”
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