Continued pressure on rates a top concern for delegates at SIRC 2019, Intelligent Insurer survey finds
Continued pressure on rates despite recent losses is the biggest concern for delegates at SIRC this year, according to a survey carried out by Intelligent Insurer. Some 41 percent of respondents highlighted this as a key challenge.
Worldwide it has been observed that where rates have improved following losses, this has been very localised in the areas affected by the losses and has not affected the market as a whole. However, there is some expectation that recent big catastrophe losses could drive a clearer hardening of rates in the January renewals.
In a conference heavily focused on future trends, some 23 percent of delegates said that consolidation and the changing re/insurance landscape would be a top concern this renewals season. There has been a large amount of consolidation over the past two decades, with the largest reinsurers now having the lion’s share of the market.
“I will be interested to discuss how the re/insurance landscape will continue to evolve, especially as the risk landscape is changing so quickly,” said one respondent.
The re/insurance market in Asia has been performing well recently, with many players pursuing growth in the region. In line with this, some 23 percent of delegates surveyed said they have no worries; business is good. Only a small number (4 percent) said clients are buying less coverage.
Looking to the future, 36 percent of those surveyed said they would be pursuing opportunities to expand into new lines of business. An ageing population, climate change, rising healthcare spending and cyber risk are all areas that could present opportunities but they also come with uncertainty.
Some 32 percent of respondents said that they would be focusing on improving the profitability of existing business, a theme linked to growing interest in insurtech and its potential to increase efficiency and reduce the need for intermediaries.
“We cannot afford to remain static,” said one respondent. “Improving efficiency by embracing technological developments such as real-time analytics has the potential to drive greater profitability.”
Some 28 percent of respondents said they saw an opportunity to grow their market share in existing lines.
Opportunities
Asia remains a key market for growth opportunities, with a rapidly growing middle-class sparking a rising demand for insurance. Earlier this year, Munich Re’s Insurance Market Outlook predicted that while the US will remain the world’s largest insurance market because of its high premium volume, China is in second place, and the gap is set to close, with China gaining significantly in terms of volume.
The issue of climate change is high on the radar this year, with a panel session at SIRC today dedicated to the topic, featuring the views of Amer Ahmed, CEO, Allianz SE Reinsurance; Rowan Douglas, CEO, capital, science and policy practice, Willis Towers Watson; Hauw Soo Hoon, director and independent board member, SEADRIF insurance company; Benjamin Horton, chair, Asian School of the Environment, Nanyang Technological University; and Vijayasekar Kalavakonda, senior financial sector specialist, International Finance Corporation, World Bank Group.
On the agenda for tomorrow is a keynote session from Swiss Re’s Jerome Jean Haegeli on the role of re/insurance in making the world more resilient.
