Singapore remains top re/insurance hub in Asia

Singapore is likely to maintain its position as the pre-eminent re/insurance hub in Asia, despite the emergence of rival centres in the region, according to Axco Insurance Information Services.

There are two distinct forces driving the Singapore market, which are diametrically opposed to each other, according to Axco’s latest report. The Competition Commission is active in trying to ensure personal lines business remains as affordable as possible. At the same time, the regulator is under pressure from international financial institutions to ensure the enhanced solubility of the market by introducing stricter solvency rules and enterprise risk management regimes, said Axco.

Capacity is increasing all the time in respect of the number of companies operating, both for domestic and regional business, and also in terms of individual company underwriting capacity and the scope and breadth of classes offered, according to the report.

Offshore business increased in volume from $1.5 billion to $6.1 billion in the seven years to 2013 and much of this has been driven by reinsurance in the region, according to the data. Whilst the larger reinsurers maintain offices in other parts of Asia - Hong Kong, Shanghai, Kuala Lumpur and Labuan - Singapore remains the location of choice for a single Far East regional operation.

Tim Yeates, managing director at Axco, said: “Singapore has long been the destination of choice for re/insurers looking to establish a foothold in Asia and this status is unlikely to change in the near future thanks to a stable government, a favourable tax regime, excellent communications and well trained staff.

“The implementation of freedom of services across the 10 Association of Southeast Asian Nation (ASEAN) member states which is predicted to apply to re/insurance in the next few years will further boost an already strong market.”