Asia must innovate: Munich Re
Munich Re is observing growing demand for new solutions and services in Asia-Pacific, ranging from capital management optimisation to new product development, Hermann Pohlchristoph, member of the board of management of Munich Re, told SIRC Today.
“The challenge for the reinsurance industry will be to become more dynamic in understanding and pricing the fast-evolving risk landscape across Asia-Pacific,” Pohlchristoph said.
At the heart of these new trends lies technology, he noted. In Asia-Pacific, the penetration of cyber insurance is still relatively lower than in the rest of the world, where it currently sits at around 5 percent, he explained. With devices and applications becoming more interconnected, widely reported cyber attacks and the enforcement of regulations relating to cybersecurity are leading to an increased awareness and demand for cyber insurance solutions in the region, Pohlchristoph said.
This is particularly true for smaller companies, in terms of financial loss protection as well as post-incident services that help them to resume business operations quickly, he noted.
The region’s fundamentals of sustained economic growth, intensifying infrastructure and relatively low insurance penetration are growth drivers for the re/insurance industry, Pohlchristoph said.
In India, the opportunities for growth are significant across various lines of business, including personal line solutions in health, home and auto, as well the significant capacity requirements in the agricultural sector.
With its enormous growth potential and increasing affluence, the Chinese market is still dominated by motor business, but industry efforts to build more liability business are gaining traction, Pohlchristoph said.
“We are still seeing an influx of new reinsurers into the market, and major innovative disruption is coming from the distribution channel side through digital players,” he noted.
In south-east Asia, Munich Re sees market dynamics such as high fragmentation, a steady move towards consolidation and rising middle classes that are supporting a narrowing of the protection gap.
“We have started to strengthen our regional footprint through our centre in Singapore over a year ago to ensure greater proximity to clients and to provide the high-quality knowhow and services to our clients across south-east Asia,” Pohlchristoph said.
Munich Re also sees potential in unleashing the power of data analytics and artificial intelligence (AI) to enable more tailored solutions for the insurance industry. Globally, Munich Re is actively making use of these technologies by developing new digital products, services and distribution channels, such as new underwriting algorithms or platforms that enable more efficient AI-based claims management.
“We are building out this capability in Singapore to serve the region,” Pohlchristoph said.
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