Government spending means opportunities for re/insurers

Government-stimulated infrastructure spending in countries such as China and across Asia presents a unique opportunity for Allianz Global Corporate & Specialty SE (AGCS) due to the company’s energy and engineering expertise, Mark Mitchell, regional CEO at AGCS for Asia, told EAIC Today.

“It’s an exciting pocket of the Asian market,” he said. “Meanwhile, cyber risk is an emerging class of insurance in Asia: there are more and more cyber attacks and the cost of those attacks is increasing quite rapidly. It’s getting a lot of press, which is leading to a lot of enquiries from our customers.”

Cyber and reputation risks have recently started to appear in the results of Allianz’s annual Risk Barometer survey, with risk managers increasingly identifying these areas as a high priority, he said.

A related opportunity is the prospect of extending business interruption and contingent business interruption insurance penetration into the market, where demand for these products has historically been low compared to demand in western countries but, in the wake of more catastrophe events, it has gained more attention.

“A challenge for risk managers is also an opportunity for us to introduce new products or upsell to our existing customer base,” said Mitchell.

AGCS is in a period of rapid growth in Asia, he added. In the first half of this year, the company’s business grew in excess of 40 percent in Asia as a whole, with more than 60 percent growth in China.

“We are looking to continue that momentum. There are a number of ways we can do that: introducing new products is one of those, as there are a lot of capabilities and products that exist within the Allianz Group which we’ve not yet exported to this part of the world. We are focused on doing that in the next 12 to 14 months.”

AGCS is also focused on getting its experts closer to its clients. “We are seeing this in China and Hong Kong in particular, where we have moved a lot of our engineering capabilities and some of our risk management capabilities to those markets.

“The early signs have been very positive—we have seen significant growth. Because we are focused on larger complex risk and larger corporate clients in the specialty segment, it is all about demonstrating expertise and you can only do that through your people, so putting those people closer to the client is important.”

In recent years, a rise in Asian conglomerates expanding into western markets has created another area of opportunity for AGCS, with companies seeking Asian insurance partners to follow them on their paths of expansion.

To that end, AGCS has its International Insurance Solutions for multinational risks.

“In the past, Asian customers tended to invest elsewhere in Asia; now that they’re investing abroad, for example into the US, Europe and Australia, they are wanting to buy centralised insurance programmes,” said Mitchell.

“There are very few companies in the market that have the ability to match the footprint which their clients might have with their own insurance operations—so through our network of 160 countries we are able to issue policies, administer, service claims and match the footprint of our customers.”