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SINGAPORE has ambitions to be not just a regional insurance hub in Asia but also a global insurance hub. However, we are not there yet, nor are we alone in our aspirations. What can be done to help Singapore to leapfrog ahead?
In a keynote address in November 2013 at the 12th Singapore International Reinsurance Conference, Ravi Menon, managing director of the Monetary Authority of Singapore, outlined Singapore’s vision of being “a global insurance marketplace in the heart of Asia”. The vision is for the Singapore insurance industry to have the ability to accept not just regional but global risks by 2020.
Currently, there are two competitors in the race to become the next global insurance marketplace in Asia – Hong Kong and Singapore. Both Hong Kong and Singapore have similar elements in place – fairly liberalised insurance markets, sound regulations, and simple and efficient tax regimes. Both also enjoy strategic geographical locations: Hong Kong with China as hinterland and Singapore as a gateway to South-east Asia and the ASEAN Economic Community.
They also both stand to benefit from the same three key factors driving insurance demand in Asia – rising economic growth in the region (a growing middle class, urbanisation, continued industrialisation and expanding cross-border trade will lead to an increased demand for insurance solutions from businesses, as well as demand for more sophisticated personal financial services such as insurance); Asia’s vulnerability to natural catastrophes; and Asia’s rapidly ageing population. The increasing use of technological solutions and devices has given rise to new and emerging risks. In addition, global environmental and climate change will bring larger risks and uncertainties. All of this points to a growing demand for insurance, not only at a regional level but likely at a global level too.
by Ang Sock Sun, Yip Yoke Har, Woo Shea Leen
See Full Story at news.asiaone.com