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EC News Asia Edition (21st March 2018)

  • Publish Date: Posted about 6 years ago
  • Author:by Alan Jarque

Round-up of the latest news and developments from the Asian insurance market with stories from JLT Re, Aon, QBE and more.

JLT Re appoints Krishnan as ceo of Asia Treaty business

JLT Re has hired Vinod Krishnan as CEO of its Asia treaty business.

Based in Singapore, Krishnan will be responsible for building the treaty offering in the ASEAN nations and South Korea.

Prior to joining JLT Re Krishnan most recently held the role of CEO at Aon Benfield Asia.

Krishnan is expected to assume his new role in May 2018 when his current contractual obligations are satisfied.

Commenting on the appointment, global CEO of JLT Re Mike Reynolds said: “We are pleased to announce the appointment of Vinod Krishnan to JLT Re Asia Pacific. With over 18 years’ in client focussed, leadership and analytical roles, Vinod will bring a wealth of experience to strengthen and provide depth to our treaty offering across the Asia region. Vinod’s appointment is testament to the importance JLT Re places on our APAC clients and business”.

Aon announces appointments for One Underwriting

Aon has named Adam Cox as the new director of One Underwriting to lead Aon's expanding managing general agent business.

Former One Underwriting director, Alison Smith will transition into Aon's broking area, appointed as the new regional director, Southern and Western - commercial.

Cox will lead a specialist national team of 30 underwriters to expand and leverage Aon’s global capabilities locally. He joins the company after eight years with Swiss Re where he was most recently responsible for leading ANZ business strategy as country manager, corporate solutions.

Smith, who led One Underwriting since its launch in January 2016 will now head up Aon’s client engagement for its mid-market and SME clients in Victoria, Tasmania, South Australia and Western Australia.

HSBC Insurance (Singapore) appoints Vazquez as CEO

HSBC Insurance (Singapore) has appointed Carlos Vazquez as its new CEO, succeeding Ian Martin who will be assuming a new global role in HSBC Group Insurance based in London.

In his new role, Vazquez’s key mandate is to accelerate the growth of HSBC Insurance in Singapore through the insurance distribution potential within the HSBC Group, expanding its strategic distribution partnerships, and delivering innovative direct-to-consumer digital solutions.

Vazquez joins the company from Manulife (Singapore) Pte. Ltd where he served as chief product officer, responsible for overseeing product management and pricing. Additionally, he played a key role in successfully launching the DBS-Manulife partnership.

Vazquez also previously served as the chief product officer for Manulife Indonesia, where he led the launch of many local product innovations. Vazquez is a fellow of the Society of Actuaries and a member of the American Academy of Actuaries.

HSBC’s group head of insurance, Bryce Johns said: “Carlos brings a wealth of market experience, and a deep knowledge of the insurance industry, with over 20 years of experience in Asia and North America”.

Tony Cripps, chairman of HSBC Insurance (Singapore) and CEO of HSBC Singapore, said: “We’re really excited to have Carlos on board at this pivotal moment for HSBC Singapore as we continue to invest and grow our business. Working closely with HSBC Insurance, we are able to bring our combined strength and expertise to meet the broad range of protection needs of our retail, high net worth and corporate customers.”

Johns added: "I would like to thank outgoing CEO, Ian Martin, for his significant contributions, especially in terms of achieving Tier 1 Status in Singapore. We wish him the very best of luck in his new global role”.  

Prudential Corporation Asia hires Spencer as COO

Prudential Corporation Asia (PCA), a business unit of Prudential has appointed Robin Spencer as COO.

As a member of the PCA executive team, Spencer will primarily be responsible for ensuring that PCA has a scalable and efficient operating model to deliver on the business’ strategic agenda.

Spencer will lead the evaluation and implementation of opportunities to leverage the company’s business scale across Asia and Africa, delivering greater levels of efficiencies. He will also lead the production of an operational blueprint for the overall business; implementing a framework for PCA to optimise key business investments.

Spencer boasts over 20 years’ experience in the insurance industry spanning life, non-life and asset management in the UK, Europe, North America and Asia.

He joins the business from NN Group in the Netherlands, where he is CEO International Insurance, with responsibility for the European, Japanese and reinsurance businesses. At NN, Spencer focused on building great teams with strong execution capability. Prior to the NN Group he was CEO of Aviva UK & Ireland General Insurance and was previously the chief risk officer of the Aviva Group.

CEO for PCA, Nic Nicandrou commented: “I am delighted that Robin will be joining the business. Robin brings a wealth of experience and a proven track record of delivery across regions. He has driven transformation across the different businesses he has led, by harnessing growth opportunities and improving business scalability and efficiency; all of which are key priorities to the success of PCA.”

Spencer is expected to join PCA on 1 July 2018.

CIRC vice chairman elected as vice chair of IAIS exec committee

Vice chairman of the CIRC Chen Wenhui has been elected as the first vice chairman of the executive committee of the International Association of Insurance Supervisors (IAIS), representing emerging markets.

The IAIS is a voluntary membership organisation of insurance supervisors and regulators from more than 200 jurisdictions, constituting 97 percent of the world's insurance premiums.

The election took place when the IAIS met in Basel in Switzerland on 28 February.

The CIRC said that the election of Chen represents recognition of achievements that have consolidated China's leading role in the reform and construction of the global governance system and will effectively enhance China's influence in the international arena.

The regulator said that it would make use of the platform of vice chairman of the executive committee to take an active leadership role in all IAIS work, strengthen cooperation among IAIS emerging market members, promote more consensus, and earnestly grasp the strategic direction of emerging markets and enhance emerging market positions and governance in the international financial system, further expand the influence of emerging market members in international insurance affairs, influence the formulation and implementation of international rules and safeguard the core interests of emerging market members.

QBE restructures roles

QBE Insurance is aligning its technology and transformation teams under one business unit within its Australian and New Zealand Operations (ANZO).

As part of the transition, a new COO will have end to end responsibilities for the technology and business transformation.

Steve Raynor will act as the interim COO while the insurer carries out an internal and external search for the expanded role.

The company will also appoint a new chief information officer (CIO) which will combine technology, data, transformation and business operations.

As a result, current CIO Tony Forward has resigned from his role. Val Matthews has been appointed in an acting capacity while an internal and external recruitment process is conducted for the redefined role.

QBE has also constructed a new strategy team to bolster and simplify the business. The new team will report into the CFO Inder Singh.

Furthermore, New Zealand will be repositioned as a separate business unit. Bill Donavan, general manager of New Zealand will report to Singh.

CEO Vivek Bhatia said the move brought ANZO in line with other operating divisions in the group.

Bhatia remarked: “Given technology’s intrinsic role in delivering on our business transformation, it also makes sense to have these functions aligned under the one business unit to drive greater focus and efficiencies”.

He added: “Tony was instrumental in modernising our core policy and claims systems with the launch of Guidewire. He was also a sponsor and ally of the QBE Pride Committee, making QBE a more inclusive place to work. I wish him all the best in his future endeavours”.

“Late last year, the team developed our short-term priorities and is working hard on implementing that and transforming QBE. We’ve already made great progress on the Insurtech front, with the establishment of QBE Ventures globally, while locally, we’re a founding partner of Insurtech Australia and recently joined Stone and Chalk’s inaugural Insurtech Program, working with start-ups to solve specific customer needs.

“The General Manager, Strategy role will help drive that agenda in this market, as well as align with global counterparts to ensure we leverage our global footprint and expertise.”

Prudential plc & M&G Prudential to demerge

Prudential plc has unveiled its plan to demerge from its UK & Europe business, M&G Prudential.

The demerger will result in two separately-listed companies with different investment characteristics and opportunities. On completion, shareholders will hold interests in both Prudential plc and M&G Prudential.

M&G Prudential is one of the leading retirement and savings businesses in the UK and Europe, offering compelling product propositions through its range of investment solutions provided by M&G and PruFund.

As a standalone entity, M&G Prudential will be led by its current chief executive John Foley and will continue its transformation into a more capital-efficient and customer-focused business, targeting growing demand for comprehensive financial solutions. M&G Prudential remains on track to deliver its previously announced cost savings target.

In line with this strategy to transition towards a more capital efficient, de-risked business model, M&G Prudential also announced the sale of £12.0bn of its shareholder annuity portfolio to Rothesay Life. Under the terms of the agreement, M&G Prudential has reinsured £12.0bn of liabilities to Rothesay Life, which is expected to be followed by a Part VII transfer of the portfolio by the end of next year. The capital benefit of this transaction will be retained within the Group to support the demerger process.

Spearheaded by its current group chief executive Mike Wells, Prudential plc will combine the growth potential of its Asia, US and Africa businesses.

The Asia pan-regional life and asset management business is well-positioned to meet the savings and protection needs of a growing and increasingly wealthy population, through top three positions in nine out of twelve life markets, and through Eastspring’s established presence in ten Asian countries. Jackson is one of the largest providers of retirement solutions in the US, delivering income security to increasing numbers of baby boomer retirees.

In Africa, since 2014 Prudential has established operations in five countries, with a substantial opportunity to serve the rapidly expanding customer demand for long term financial solutions. These businesses represent a leading international insurance and asset management group focused on the markets that offer the most attractive growth opportunities globally. They will be better able to develop their existing market leadership positions, with the strategic benefits of collective scale, shared capabilities and complementary products and customers.

Prudential plc’s dividend policy will remain unchanged through the separation period. Following the demerger, Prudential plc will remain headquartered in the UK and retain its premium listing on the London Stock Exchange, its primary listing in Hong Kong, and other listings in Singapore and New York. M&G Prudential will be headquartered in the UK and hold a premium listing on the London Stock Exchange.

Chairman of Prudential plc, Paul Manduca said: “The decision to demerge M&G Prudential follows a rigorous review by the Board which considered all options, including the status quo, and concluded that it is in the best interest of the Group to operate as two separately-listed companies, able to focus on their distinct strategic priorities in their chosen geographies. Both are expected to meet the criteria for inclusion in the FTSE 100 index”.

Mike Wells, group chief executive remarked: “Our businesses share common heritage, values and purpose. Looking forward, we believe we will be better able to focus on meeting our customers’ rapidly evolving needs and to deliver long-term value to investors as two separate businesses.

“Following separation, M&G Prudential will have more control over its business strategy and capital allocation. This will enable it to play a greater role in developing the savings and retirement markets in the UK and Europe through two of the financial sector’s most trusted brands, while Prudential plc will be able to focus on the attractive returns and growth potential of its market-leading businesses in Asia and the US.”

John Foley, chief executive of M&G Prudential added: “The demerger will allow M&G Prudential to play a broader leadership role in the fast-changing savings and investments market within the UK and Europe. M&G Prudential’s proven investment capabilities and balance sheet management provide an excellent platform from which to serve the demand for comprehensive financial solutions.”

In preparation for the UK demerger process, and to align the ownership of the Group’s businesses with their operating structures, Prudential plc intends to transfer the legal ownership of its Hong Kong insurance subsidiaries from The Prudential Assurance Company Limited (M&G Prudential’s UK regulated insurance entity) to Prudential Corporation Asia Limited, which is expected to complete by the end of 2019.

The Group will look to realise efficiencies to benefit the two businesses post demerger. In addition, prior to the demerger, the Group’s debt capital position will be re-balanced across Prudential plc and M&G Prudential. This may include the redemption or debt liability management of issued debt, and new debt issuance.

Discussions have started with regulators to ensure the Group will remain subject to effective on-going supervision in line with international standards set by the International Association of Insurance Supervisors (IAIS). Discussions have also begun with our other key stakeholders, including rating agencies. The demerger is subject to shareholder and regulatory approval.

The timing of the demerger will be subject to a number of factors, including the completion of the UK annuity sale, prevailing market conditions, the transfer of the Hong Kong business and seeking to minimise costs associated with the demerger.

An update on the demerger, related steps and timing will be provided in due course.

Insurance & banking regulators to merge in China

China will set up a banking and insurance regulatory commission, according to a plan submitted to the national legislature, the National People's Congress (NPC) that would be a major overhaul for the financial sector aimed at curbing risk.

The new commission is primarily responsible for supervising the banking and insurance industries, preventing and dissolving financial risks and protecting consumers' rights.

The CIRC and the China Banking Regulatory Commission (CBRC) will be dismantled, as a part of institutional restructuring of the State Council.

The Communist Party which controls the government has stated that its priorities this year include reducing financial risk following a run-up in corporate and local government borrowing that prompted global rating agencies to cut Beijing’s government credit rating last year.

The NPC document says that the new regulator will be capable of “holding the bottom line to prevent systematic financial risk”.

It also states that the responsibilities of the two separate regulators currently overlap in some areas, leaving regulatory roles unclear.

The merger of the two regulators is seen as a move which would give the government a better handle on supervising the insurance and banking sectors which have seen increasing cross-sectoral transactions that hide levels of lending and risk.

The two regulators will hand off duties such as proposing laws to the People’s Bank of China in a sign that the central bank is stepping up its regulatory role.

The proposed changes set out in the NPC document are expected to be approved by lawmakers who end their annual session on 20 March 2018.