Asia-Pacific opportunity is growing, but there is no room for complacency

India and Southeast Asia offer strong growth prospects as insurance penetration rises.

Key points:
APAC offers attractive growth
Some lines are softening
Buyers seeking new solutions

“Emerging risks including AI, cyber, energy transition and infrastructure development present significant opportunities.”

APAC remains one of the most attractive regions globally for reinsurers, supported by favourable demographics, expanding middle classes, increasing insurance penetration and a growing need for risk transfer solutions. But evolving and changing risks and more competition also mean dangers for carriers.

That is the view of Roshan Perera, CEO, APAC, Gallagher Re, who describes the region as one of the most dynamic insurance and reinsurance markets in the world. But he stresses that the opportunities are balanced by challenges.

“Emerging risks including AI, cyber, energy transition and infrastructure development present significant opportunities. The biggest risks remain catastrophe losses, geopolitical uncertainty and the possibility that competitive conditions lead to undisciplined underwriting. Sustainable growth requires maintaining technical discipline while continuing to innovate and support clients' evolving needs,” he told EAIC Today.

The most pertinent of those needs remains natural catastrophe risk, one of the defining challenges for APAC. He explains that population growth, urbanisation, economic development, and climate-related trends are increasing concentrations of risk across many parts of the region. But insurers and reinsurers are responding in a way that is increasingly sophisticated. 

“They are investing heavily in analytics, climate modelling and portfolio management capabilities, specifically strong underwriting discipline, portfolio management, improved risk assessment, and high-quality exposure data,” he said. “We are also seeing greater interest in alternative capital, parametric solutions, public-private partnerships, and resilience-focused strategies. The objective is not simply to transfer risk but to better understand and manage it.”

Adapt to the times

“The biggest risks remain cat losses, geopolitical uncertainty and the possibility that competitive conditions lead to undisciplined underwriting.”

This is even more important as market conditions change. During the hard market, he said, the focus was largely on access to capacity and maintaining programme stability. Today, buyers have more options and can engage reinsurers around broader strategic objectives. That does not mean underwriting discipline has disappeared, he stressed. 

“Reinsurers remain selective and continue to favour companies with strong underwriting performance, good exposure management and a clear growth strategy. However, increased competition is creating greater flexibility around structure, attachment points and innovative capital solutions.

“The market is unquestionably softer than it was two years ago, but I would avoid describing it as uniformly soft. Property catastrophe capacity has increased significantly, and buyers are benefiting from improved pricing and broader choice of partners. However, conditions vary considerably by territory, line of business and individual risk characteristics.”

He added that reinsurers continue to differentiate based on catastrophe exposure, underwriting quality and profitability. Certain specialty classes and catastrophe-exposed portfolios remain subject to close scrutiny. “In APAC, local market dynamics remain highly important. There is no single regional story,” he said.

The soft market conditions have influenced insurers' expectations, with many seeking improved terms and exploring alternative structures to optimize their reinsurance spend and increase their profitability. “Some insurers are using the improved market environment to optimise programme structures and improve capital efficiency – others are opting to ‘bank’ the savings.

“Some are purchasing additional protection, increasing limits or reducing attachment points where economics make sense. We are also seeing insurers explore more strategic uses of reinsurance, including supporting growth initiatives, entering new business lines, managing earnings volatility and addressing protection gaps. The current environment further highlights opportunities to think about reinsurance as a strategic tool, not simply a cost.”

But there are wider forces at play. Regulators across the region are taking an active role in ensuring insurers have a robust understanding of their risk exposures, he notes.

He explained that regulators are also introducing policies, frameworks, disclosure requirements, and guidelines aimed at strengthening climate resilience and accelerating climate-related action.

Growth opportunities 

The APAC market is in a fundamentally sound position – this is underpinned by long-term structural demand drivers, healthy insurer and reinsurer balance sheets, strengthening regulatory frameworks, and favourable reinsurance conditions. Reinsurers are reporting strong profitability, capital levels remain robust and capacity is readily available across most lines of business, he notes. 

At the same time, demand for risk transfer continues to grow as insurers respond to rising catastrophe exposure, economic development and increasing insurance penetration across the region.

He believes India offers one of the most attractive long-term opportunities given economic growth, increasing insurance penetration and ongoing development of the insurance sector. Across Southeast Asia, markets such as Indonesia, Vietnam and the Philippines continue to offer growth potential as insurance penetration gradually improves and insurers seek support for expanding portfolios. 

Japan also presents opportunities in specialist segments and alternative risk solutions despite being a mature market, he said. “More broadly, opportunities increasingly arise from specific risks and capabilities rather than geography alone. Cyber, climate resilience, renewable energy, MGA partnerships and strategic capital solutions are all areas where we expect continued demand.”

He adds that APAC is one of the most diverse regions globally, so regulatory and geopolitical developments have a significant influence on strategy. “Insurers are paying closer attention to capital efficiency, supply chain risk, inflation, local solvency requirements and geopolitical uncertainty. 

“Regulatory changes continue to drive demand for more sophisticated risk and capital management solutions. At the same time, reinsurers are increasingly helping clients navigate strategic decisions around growth, capital allocation and portfolio optimisation. As mentioned previously, I see the importance of the role of reinsurance expanding beyond capacity provision towards broader strategic advisory support.”

For a broker he said the priority is simple. “Focus is on helping cedants unlock that opportunity through data-driven insight, deep local expertise, and access to the broadest range of risk and capital solutions available. The most successful organisations over the coming years will be those that combine underwriting discipline with the willingness to innovate and adapt.

“That means investing in our people, deepening client relationships, expanding differentiated capabilities such as analytics, advisory, and strategic solutions, and leveraging the full strength of Gallagher Re's global platform. We are focused on disciplined growth, operational excellence and helping cedants navigate an increasingly complex risk environment.”

Roshan Perera is the CEO of APAC at Gallagher Re. He can be reached at Roshan_Perera@gallagherre.com

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