Singapore’s insurance industry experienced a “good year” in 2017 despite higher than usual marine cargo losses and several major fires, according to major insurance brokerage
Aon.
Aon’s Asia Market Review 2018 revealed that Singapore’s general insurance rates decreased by 7.5% to 12.5%, while health and benefits rates dipped by 5% to 12% in 2017.
As previous years’ softening trend continued throughout 2017, several Singapore-based markets sought to guarantee premium income by putting their capacity behind structured portfolio solutions or facilities, which are largely still profitable.
“In addition, we also saw some insurers relax their underwriting criteria and increase their appetite for risks that they had not typically written in the past,” the report said.
Over the past year, Aon found that Singaporean general insurers were releasing more blended products. These new offerings combine traditional insurance coverage for physical damage and loss of revenue with a crisis consultancy service, which will protect the insured’s reputation in case of a major loss event.
According to Aon, this shows that underwriting models in the Singaporean market are maturing, as well as increasing client demand for value-added services and products that go beyond traditional insurance offerings.
Going into 2018, Singapore clients can expect rate reductions similar to the previous year. General insurance rates are expected to decrease by 5% to 10%, while health and benefits rates may decrease by 5% to 12%.
“Looking ahead to the next 12 months, some underwriters from international insurers will be under pressure from their head office not to provide further rate reductions in 2018, but overall, we expect to see reductions available for well-managed risks, albeit of a smaller order than in 2017,” Aon said.
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