Singapore Establishes Itself As Centre For Insurance Risk Research In The Region
Singapore plans to boost its research initiatives on insurance risks following the string of catastrophes and economic changes that took place in the Asia Pacific Region to further inform Asian companies of investment risks and how to manage their assets better.
According to Monetary Authority of Singapore (MAS) Assistant Managing Director Ng Nam Sin, the Singapore would be aggressively pursuing the insurance risk research plan by tapping the SCOR Global Risk Centre and Nanyang Business School in creating the Insurance Risk and Finance Research Centre (IRFRC).
“The partnership between SCOR and the Nanyang Business School (NBS) to establish the IRFRC is an example of how the industry and academia can work together,” said Ng. “The IRFRC’s focus on Asia will help to provide much-needed insight on risk management and insurance issues in the region.”
Asia Pacific is confronted with a low insurance penetration rate, longevity risks and catastrophe risks. Based on the data released by Swiss Re, the insurance market penetration rate in Asia sits at a mere 3%, as opposed to a 9% market penetration rate in more advanced economies.
Retirement needs are also increasing as people in Asia are living longer. And with assets values increasing throughout the years, people and business entities should understand how to manage the catastrophe risks involved in maintaining their assets.
The said risk research effort would also help boost foreign investment opportunities in the region, now that research institutes are looking into the areas of insurance practice that need improvement. With established data and improved policies, foreign companies would feel more secure in continuing to expand their operations in the region in the wake of the disasters that struck Japan and Thailand.
Asia’s under-insured state also presents a rosy growth opportunity for insurers. Based on the study by the United Nations, 54% of global urban population growth in the next forty years would come from Asia. This would translate to an increased demand for insurance products and services.