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Pricing remains ‘acutely weak’ in Singapore’s insurance market.
The fundamental growth story for Singapore’s insurance sector continues to be intact, as the savings rate rises and dependency ratio remains low. Its status as a regional centre for economic activity also continues to bolster demand for insurance across segments. “Singapore continued to build its position as a regional hub for property and casualty insurance and reinsurance,” says Peter Allen, global head of Grant Thornton’s insurance practice.
As firms aggressively try to deploy excess capital, undercutting is a natural consequence as customers often cannot be acquired fast enough to meet the supply being brought to market.
Derry Finkeldey, director of research at technology research firm, Gartner, notes that “distribution, and leveraging digital channels and capabilities to drive new business, but also to create stickiness with existing customers and increase persistency and renewals, continues to be a top of mind concern for Singaporean insurers”.
Given that this is quite a mature market in Singapore, firms are continuing to look for new ways to approach marketing campaigns as well as increase spending in innovative technology solutions according to Finkeldey.
“Insurers are slowly embracing digital channels for improving service quality. We are expecting a lot of activity around digital in 2016” says Ernst & Young advisory partner Sumit Narayanan. He notes that we are seeing an increase in insurers looking to find ways to communicate with their customers beyond the traditional points of contact, which are transactions such as premium payments and claims settlements.
by Krisana Gallezo-Estaura
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