China’s National Administration of Financial Regulation (NAFR) has granted approval for the creation of Beijing BNP Paribas Tianxing Property Insurance Co Ltd.
According to AAStocks, the company is a new venture involving BNP Paribas, Sichuan Yinmi Technology, and Volkswagen Financial Services Overseas as principal stakeholders.
Beijing BNP Paribas Tianxing Property Insurance received the green light as the Asia-Pacific property insurance sector is projected to see considerable expansion, with written premiums expected to rise to $152.2 billion by 2028 from an estimated $93.1 billion in 2023, based on data from GlobalData.
This represents a compound annual growth rate (CAGR) of 10.8% over five years, significantly outpacing global property insurance projections, which are anticipated to grow at an 8.1% CAGR through 2028.
Within the APAC region, China, Japan, and Australia are expected to account for the majority of property insurance premiums by 2024, with an estimated combined market share of 75.2%. China’s portion is forecast to be 36%, followed by Japan at 23.5%, and Australia at 15.7%.
Aarti Sharma, an analyst at GlobalData, said the APAC property insurance market is projected to expand by 8.3% in 2024, largely due to increased underwriting rigor and higher premiums, particularly in the fire and home multi-risk categories.
Sharma further noted that regulatory changes, coupled with the use of artificial intelligence and machine learning for risk assessment and claims management, are anticipated to bolster the industry’s performance.
Fire and home multi-risk insurance products are expected to drive a significant portion of the region’s property insurance growth in 2024.
An uptick in natural disasters, such as severe storms, has led to greater demand for these coverages. In early 2024, the Insurance Council of Australia reported economic damages exceeding $495 million (US$322.2 million) due to storms across New South Wales, Queensland, and Victoria.
Japan has also seen adjustments in response to natural disaster risks. The General Insurance Rating Organization of Japan (GIROJ) raised fire insurance benchmark rates from 5.5% in 2018 to 13% by 2023.
Sharma said the heightened demand for fire and multi-risk policies stems from a growing awareness of natural disaster risks and the importance of comprehensive coverage, with elevated reinsurance costs and poor loss ratios limiting insurers’ capacity for high-exposure segments.
Technological advancements, particularly in artificial intelligence and machine learning, are set to play a key role in driving the APAC property insurance market.
By enabling better sales targeting, risk assessment, and customer engagement, these technologies are providing insurers with vital tools to navigate a changing landscape, according to GlobalData.
Sharma said that AI-driven analytics can assist insurers with generating sales leads, while virtual assistants and chatbots enhance customer interactions and improve efficiency in areas like policy inquiries and claims.
Regulatory measures are also shaping the property insurance sector across APAC. In April 2024, the National Financial Supervisory Authority (NFSA) of China issued guidelines to promote green insurance, which encourages environmentally sustainable practices.
In Australia, the 2022-2025 federal budget includes additional disaster resilience funding for the Insurance Council of Australia, as part of a broader commitment to enhance disaster preparedness.
