During the 2023 Global Insurance Forum held in Singapore, the country’s deputy prime minister, Lawrence Wong, spoke about the challenges facing the sector that would need to be unlocked to accelerate the value of insurance.
Calling it the three “Ts,” Wong talked about transition, technology, and talent as important themes that require the industry’s attention.
“The climate crisis is worsening and requires collective and urgent action. Global temperatures are rising, and this has already impacted food and water security in many parts of the globe. We are experiencing more frequent weather changes, and more fatal extreme heat events. We are in a race to reach net-zero by 2050, to avoid irreversible global climate damage. Year-by-year, when we look at the events around us, we worry that we are lagging behind in achieving this target,” Wong said in a news release.
Wong also called Asia as “the key battleground in this race to net-zero,” citing that the region accounts for half of the global greenhouse gas emissions with most energy needs still highly dependent on fossil fuels.
“As underwriters, the industry can develop insurance solutions for renewable energy infrastructure and emerging technologies with promising decarbonisation potential. These solutions can help mitigate risk and help crowd in much-needed private capital. As investors, insurers can allocate more capital to address the infrastructure needs of emerging Asia, particularly green infrastructure. The scale and investment characteristics of infrastructure line up well for insurers’ investment needs,” he said.
Moving on to technology, Wong said that several big-name insurers are now experimenting with generative AI and how it can transform businesses. While he acknowledged that there are still limited use cases of strong impact, he was confident that its maturity would bring better results across the industry.
“In time to come, I have no doubt that the models will get better and will be applied across a wider range of applications and functions, and will bring about the transformation in finance and insurance. At the same time, we will have to grapple with deep ethical issues, and consider how AI systems can be imbued with human context and human values,” he said.
Homing in on the last “T,” Wong said that addressing the region’s growing insurance needs will require a strong base of Asia-savvy talent, all of which have the linguistic skills and expertise necessary to recognise Asia’s diversity.
“The industry needs to have a well-thought-out strategy and come together in a more systematic manner to attract and cultivate such talent. Key to this will be efforts to attract younger people, including from our polytechnics and universities. There is stiff competition for talent everywhere, in all sectors of the economy, and especially in finance. So, the insurance industry will need to redouble efforts to attract its share of talent,” he said.
“Today, if you do a survey of young people thinking of career choices in finance, most of them, top-of-mind, will think about jobs in a bank, an asset management firm, or a family office. We want them to also think about the wide range of attractive and exciting career prospects and pathways in insurance, as all of you can attest to,” Wong said.
Wong concluded his address by reiterating his confidence in the industry to deepen its value to society across these three aspects and expressed his hope of further developing Singapore as a “reliable and trusted hub for finance and for insurance, in the region and in the world.”
In other recent developments for the region, the Monetary Authority of Singapore has unveiled proposals for ways to tackle mobile malware scams and risks associated with generative AI across the financial sector.
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