Economies in the region are starting to show signs of real growth on the back of recovering global commodity prices and insurers are looking for new ways to take advantage of the renewed economic growth and the opportunities arising from it, said FAIR secretary general Dr Adel Mounir during the opening ceremony of the 26th Federation of Afro-Asian Insurers & Reinsurers (FAIR) conference in Marrakech yesterday.
But while economies are recovering, there are other significant challenges and developments which insurers need to consider in order to take full advantage of the growth potential, he said.
“A deepening market for insurance is contributing to wider ASEAN policy aims with regard to economic risk management, capital market deepening, healthcare provision and infrastructure financing. The potential for this market at the regional level is now well understood,” he said. While insurance market liberalisation has not been included as an initial priority due to political or policy sensitivity, commitments to liberalisation have nevertheless been made and the prospect of future regional competition has spurred regulatory and sectoral reform across the region.
Dr Adel noted that a range of challenges remain for ASEAN policymakers and insurers. “First is the need to address the wide range of regulatory capacity across the region, which will take time and resources. Second is the need to ensure fair and equal treatment of foreign and domestic firms. And lastly, given the way that ASEAN lacks the kind of strong institutional centre that defines the single market – like the EU – the challenge will be ensuring that this liberalisation trend is accompanied by a strong push for regulatory convergence,” he said.
“It is encouraging to see that insurers in the Asian region have maintained their high rankings in terms of total premiums in 2018, with China taking the lead,” he said. Japan recorded an increase of 4.8% in total life premiums, followed by Taiwan with an increase of 3.5%, Thailand (10.9%), Vietnam (30.2%) and Bangladesh (7.9%).
In non-life premiums, China recorded an increase of 16.8%, followed by Thailand (11.9%). Closer to the region, Kuwait and Zimbabwe recorded notable increases of 17.6% and 17%, respectively.
This year’s FAIR conference, attracting close to 1,000 delegates from 64 countries, is jointly hosted by the Société Centrale de Réassurance (SCR).