3.3% rise in gross written premiums for Labuan-based insurers

Insurers and reinsurers in the Labuan International Business and Financial Centre (IBFC) witnessed an uplift in gross written premiums of 3.3% to US$1.4 billion. With challenging oil prices, the insurers and reinsurers successfully changed focus from oil sensitive industries like engineering and marine to other specialised lines. The IBFC saw an increase in premium retention, mirroring the internal capacity of Labuan’s insurance industry to underwrite more business, particularly business from non-residents which contributed 57.9% of total premiums. 2016 also achieved the biggest underwriting margin since 2012, attributed to higher earned premiums written and lower claims during the year. Overall the sector registering profit before tax that grew by 52.4% to $387 million and a margin of solvency of more than six times above the minimum regulatory requirement. Wealth management solutions continued to be offered by the IBFC to meet the needs of high-net-worth individuals in the Asia Pacific, a region of significant wealth creation over the last decade. In 2016, there was a 13.2% growth in the establishment of Labuan foundations to 188, of which 78.2% originated from the Asia Pacific region.