Description
The power of finance has been an area of great interest since the Global Financial Crisis. Within the field of International Political Economy, analysis has focused on structural and instrumental power of banks, while non-bank financial institutions, and insurers in particular, have received less attention. This neglect is significant, as the insurance industry is central to risk management, necessary for global finance and trade, and plays a vital role in household and government finances. This paper aims to redress this blind spot by developing new frameworks of power, capturing insurers’ role as risk mitigators rather than credit facilitators. The paper develops these frameworks through the case study of the Solvency UK directive and process tracing. The UK insurance industry is both domestically significant and internationally important, while Solvency UK is an opportunity for firms to influence regulation and showcase instrumental power. The paper demonstrates that insurers face different constraints when lobbying for policy change due to unique business models and structural standing within the UK. It further shows that manifestation of power varies between different types of insurers. The paper further develops our understanding of an important industry in IPE by deepening and diversifying our conceptions of power in finance.
