Singapore enjoys the international reinsurance industry’s vote of confidence as a key reinsurance centre in the region, despite turbulent international economic conditions caused by geopolitical tensions, natural catastrophes, inflation, and the aftereffects of the COVID-19 pandemic.
This was stated by Alvin Tan, Singapore minister of state for trade and industry, and board member of the Monetary Authority of Singapore, in his speech at the Singapore International Reinsurance Conference on Monday,
Tan said that despite a stormy global economy, the outlook for the reinsurance industry in Asia remains positive due to continuing urbanisation in the region, a growing middle class, and increased production and consumption.
“In 2025, gross written premiums for life and non-life insurance are expected to grow to SG$60 billion and SG$20 billion respectively,” Tan said. “Correspondingly, more lives, wealth and assets will need protection.”
Tan said these growth trends will benefit Singapore’s insurance industry, given its role as a key reinsurance centre for the region. Over the past five years, total reinsurance premiums have more than doubled, reaching SG$20 billion in 2021. According to Tan, this growth was achieved by the industry’s vote of confidence in Singapore.
“Since 2017, reinsurers have progressively developed their Asia-Pacific functions in Singapore to better support the region’s insurance markets and provide risk financing solutions,” Tan said. “Reinsurers have also established strong partnerships with local and regional insurers to produce more accurate risk assessments, support underwriting and pricing, and improve customer value propositions.”
Singapore has continued to be an important specialty insurance hub for Asia by growing its capabilities in newer lines of risk, such as cyber, Tan said. While cyber insurance remains a nascent market in Asia as compared to Europe and North America, more insurers are establishing their cyber underwriting desks and resources for Asia in Singapore.
“We have complemented our reinsurance market growth and debt capital markets capabilities by establishing Singapore as a domicile for insurance-linked securities (ILS),” Tan said. “To date, Singapore has supported 22 ILS in the form of catastrophe bond issuances, by cedants across the US and Asia-Pacific. In spite of the market uncertainties from COVID-19, the ILS deal flow reflects a growing familiarity and confidence in Singapore’s ILS regime.”
