Round-up of the latest news and developments from the Asian insurance market with stories regarding innovation, Axa and India.
Customer focussed innovations driven by Insurance disruption
Insurers in Singapore have been increasingly customer focussed in an attempt to retain and attract new policyholders which has been fuelled by the continued developments in technology. Disruption will continue throughout the year, as will the rise of unions between innovation-starved insurers and technology-related start-ups. The main technologies driving these changes are artificial intelligence, open application programme interface (API) and blockchain. The growth in innovation has led insurers, including Aviva, AXA, Allianz and Manulife to set up labs in Singapore in recent years. Many have also moved to improve front-end processes, including making it easier for their agents to sell products or for customers to purchase policies, particularly through digital channels. Zia Zaman, chief innovation officer at MetLife Asia, highlighted that the more insurers can make the link between the problems customers are trying to solve, the way they want to solve it, experiences they want delivered and follow ups done in the way they expect, the more likely insurers are to deliver value to customers. Zaman said, "We live in an experiences economy and the product is just a part of it. It's an important part of it but it needs to be more customer-centric."
Axa launches digital tool in Indonesia
In a drive to grow its local client base, Axa Financial Indonesia, part of the Axa Indonesia Group, has launched a new digital tool aimed at a younger demographic. Axa Financial Indonesia’s move is one strand of a larger strategy by the insurance industry in the country, which continues to register low insurance penetration despite its standing as the biggest economy in Southeast Asia. Information from the Financial Services Authority (OJK) shows that the insurance penetration ratio stood at only 2.6%, below the ratios in Malaysia, Singapore and Thailand at more than 5%. The new tool will provide easy access to information for several purposes, namely creating a children's education fund, retirement fund, business capital and tourism or pilgrimage fund. Nina Ong, Axa Financial Indonesia chief agency officer, said the tool and products were for a modern dynamic citizen, aged between 25 and 45. The company anticipates the tool will help attract 20% to 30% of such citizens as its new clients and expand its customer base, which is now served by about 14,000 agents.
India’s demonetisation move is seen as an opportunity by insurers
Axa has benefitted from the governments push to encourage more Indians to use banks, signing up over a million new Indian customers to their accident insurance products over the past three months. Other big insurance groups are eager to capitalise on the rapidly expanding $60bn market, with companies such as Allianz and Generali looking at ways they can profit from the surge in Indians entering the banking sector. The plans come as Narendra Modi, prime minister, revealed late last year that he would remove 86% of India’s cash supply to direct people towards the banks. The government has at the same time licensed almost a dozen payment banks, which are allowed to take small deposits, pay bills and transfer money through a mobile phone. The licence includes the ability to offer third-party financial products such as insurance; giving insurers access to a new customer base. Currently half of India’s population of 1.3bn people do not have a bank account. Bharti-Axa, a joint venture between insurance groups Bharti and Axa in India, signed a deal in November with Airtel, a leading telecoms group that has set up the first payment bank in India, Airtel Payment Bank. Every user of the bank is receiving free Bharti-Axa accident insurance of up to Rs100,000 ($1,500)
Cambodia’s Insurance market grew 36% to reach US$114mn in 2016
The insurance market in Cambodia witnessed record growth last year and was valued at US$114 million. The total gross premium in the Cambodian market rose by 35.6% to $113.6 million last year compared with $83.7 million in 2015. A report into the insurance market in Cambodia said that the insurance market has continued to grow year-on-year due to increased coverage in property and fire insurance, medical insurance, engineering insurance, personal accident insurance, and marine, aviation and transport insurance. Huy Vatharo, IAC chairman said, “The growth of the insurance industry in Cambodia defines a better future for the Cambodian economy as the risks involved, as well as financial strains that could befall Cambodian families and businesses, are transferred to insurance companies instead”. Vatharo said that other than general insurance, the life insurance industry has also been playing a crucial role in building a healthier financial future for Cambodian families while also driving the long-term economic development of the country.
Singapore and Israeli universities combine to counter cyber threats
Singapore's Nanyang Technological University (NTU) and Israel's Ben-Gurion University of the Negev (BGU) are working together on innovative ways to combat cyber threats. The joint research project, called the Bio-Inspired Agile Cyber Security Assurance Framework (BICSAF), hopes to create innovative technologies for countering advanced persistent threats, which pose a problem to present methods of detection due to their long periods of covertness. The venture will receive S$3 million (US$2.1 million) in joint funding from NTU, BGU and Singapore’s National Research Foundation. Led by the Cyber Security Research Centre at NTU, faculty and researchers from both universities will be involved in developing new technologies to counter cyber threats. Inspiration comes from the ability of the human immune system to adapt and fight ever-evolving bacteria and viruses. Prof Lam said, “Through this partnership, NTU and Ben-Gurion University of the Negev will be able to develop innovative methods for combating one of the most complicated problems in cyber security – Advanced Persistent Threats (APTs). This project will leverage on NTU’s strong hardware-based research expertise and BGU’s software-based core competences to combat this intractable problem.”
New tsunami detection system for Indonesia
Scientists from Indonesia and the US have developed a new prototype for Indonesia's tsunami detection system, potentially giving coastal towns and cities some valuable extra minutes of warning. The country’s incumbent system comprises seafloor sensors that communicate with transmitting buoys on the surface, which are vulnerable to vandals and lack of funding. Each of the 22 inoperable buoys cost several hundred thousand dollars each. When a large earthquake hit near the Mentawai islands 170 km from the city of Padang in West Sumatra in March, none of the buoys were operational. Although no tsunami struck, there was a panicked evacuation and officials did not remove the tsunami warning for two hours because of a lack of information. The latest prototype, nearly four years in the making, is set up for detection of near-field tsunamis and has been tested off Padang, It currently awaits a decision on government funding to connect it to disaster agencies on land. Padang and nearby cities are threatened, as it has been found that an earthquake bigger than magnitude 8.5 is possible off the city in the next few decades.
Singapore-based broker targets mainland operation
CXA Group, the Singapore-based health technology start-up, plans to work with Chinese conglomerate Fosun International to set up a new platform on mainland China. The new platform will automate employee health care programmes and create a marketplace for wellness providers. Rosaline Chow Koo, the founder and chief executive of CXA, confirmed that the cooperation will see it expand into Beijing, Shanghai, Guangzhou and Shenzhen. Koo said that the company will directly work with Shanghai Zhongheng Insurance Brokers, a unit of the Fosun group. The plans for China come after CXA’s announcement of a successful Series B investment round worth US$25 million, led by B Capital Group and the Singapore government’s Economic Development Board Investments. Koo hopes the funding round will drive CXA's expansion into China, India, Japan, South Korea, Taiwan, Indonesia, Malaysia, the Philippines, and Thailand.
Chinese insurers put US$240bn into infrastructure projects
Chinese insurers enabled 651 investment projects to launch with registered capital of CNY1.65 trillion (US$240 billion) in infrastructure and livelihood improvements last year. The investments were through equity and bond purchases, as well as asset support plans, which largely went into transport, energy, real estate, healthcare and elderly care. Chinese insurance capital has also been put into national development strategies such as the Belt and Road Initiative, the Yangtze River Economic Belt and the coordinated development of Beijing, Tianjin and Hebei. Insurers have invested CNY592.3 billion yuan in the Belt and Road Initiative and CNY135.9 billion in the Yangtze River Economic Belt. Insurers are encouraged to provide funding to develop the country's real economy, as insurance capital is considered as large and stable long-term funds.
New casualty underwriter added to XL Catlin’s Hong Kong team
XL Catlin has strengthened its Casualty team with the appointment of Stephen Chow as casualty underwriter based in Hong Kong. He will report to Anna Jzie, casualty underwriting manager. Chow has over four years of underwriting experience across the Greater China market. He joined XL Catlin from Munich Reinsurance Company in Hong Kong where he focused on treaty and facultative casualty business in the region.
Marcus Giles has been named by Chubb as regional head of direct marketing
Chubb has named Marcus Giles as its vice president and regional head of direct marketing for the Asia Pacific. Chubb highlighted the importance of Giles' expertise in driving growth for consumer-facing businesses and enhancing the customer experience with innovative products and solutions. He will report to Glen Browne, executive vice president and regional head of accident and health for Asia Pacific. Giles re-joins Chubb after having served at its predecessor company, ACE in 1999. Most recently he was AIA's head of direct marketing. Browne said, "I am very pleased to welcome back Marcus given his in-depth knowledge of the direct marketing business which is evolving rapidly. With a pulse on the vast growth potential in the Asia Pacific region for direct marketing, he will work closely with our business partners to expand revenue and loyalty opportunities so that their customers have access to products tailored to meet their protection needs."
William Pang joins JLT as managing director of JLT Re Philippines
JLT Re has appointed William Pang as a new managing director for JLT Re Philippines, subject to regulatory approval. Pang has been with JLT Re for five years, working out of Singapore to manage broking clients in Singapore, the Philippines and Vietnam. Pang previously served at Munich Re for 14 years as deputy head of client management in the Asia region, as well as spending time as head of client management at Asia Capital Re more recently. Pang will relocate to Manila in the 1st quarter of 2017 and will take on responsibility for the overall management of JLT Re Philippines, with a focus on strategy, market development and team expansion amongst other areas. He will also continue to work with clients from Singapore and Vietnam. Pang will report to Kenny Moyes, CEO of JLT Re Asia, based in Singapore. Pang will also join the JLT Re Asia Pacific Executive Group as part of this new role.