The 20th Singapore International Reinsurance Conference took place in early November and continued its run as the most important (re)insurance industry event in Asia. Here are some of the topics that were covered during the conference.
The 20th Singapore International Reinsurance Conference (SIRC) saw over 3,300 participants this year, with nearly 2,000 joining in from overseas.
Singapore deputy prime minister, minister for trade and industry and chairman of the Monetary Authority of Singapore Gan Kim Yong gave the keynote address.
“Climate change, a core challenge, is accelerating, impacting risk projections. Nat CAT in Asia averaged S$106bn in insured losses annually, while a large protection gap remains – 91% of Asia’s S$65bn economic loss in 2023 was uninsured. Without more decisive action, Asia risks losing 20% of its GDP by 2048, with ASEAN nations potentially losing 29%,” he said.
“The insurance industry has both an urgent need and opportunity to bridge this reinsurance gap. By collaborating with governments, researchers and tech providers, insurers can enhance risk models, scenario analyses and climate data specific to Asia,” he said.
Energy transition
20th SIRC organising committee chair Marc Haushofer said, “This year’s theme, ‘Revolutionize (Re)insurance!’, could not be timelier as we navigate a world reshaped by climate change, technological disruption and shifting global economies. Our industry faces the task of adapting to emerging risks and embracing new technologies.”
“From addressing the urgent challenges of climate change to exploring the broad impacts of AI integration, our discussions will not only identify current opportunities but also shape our future direction,” he said.
Rising challenges
During his keynote speech during the opening of SIRC, Swiss Re group CEO Andreas Berger said that protection gap issues are so big that the industry cannot tackle them on its own.
These issues include Nat CAT and climate risks, cyber and civil unrest, all risks that have grown exponentially over the past few years.
Revolutionising the industry, he said, was about data and partnerships. “It’s about people, and it’s about making the world more resilient out there. It’s clear that we were tackling so many issues, but the issues are so big that we cannot tackle them on our own. So that’s why it needs a concerted effort, where we have to come together.
“We need to step up our game – not just to close the protection gap, but to prevent it from widening, as it is in Asia,” he said. “In fact, it’s not just widening in developing countries, but also in developed nations. The protection gap in the US is also widening.”
Part of this, he said, is due to the decisions humans make as individuals; in the US, for instance, there have been a rise in people living in flood and hurricane zones, which increases the loss numbers. “People need the right incentives to manage their risks in these exposure areas. We also need governments to do their part by improving building regulation. Without a private public partnership, this approach will not work.”
Industry role
“We are not just a shock absorber and capacity provider. We can provide dependable risk assessment. We can do effective volatility management and increase risk protection. And it’s much more than that. So, when we look at the past two decades, you can see that as an industry we were pretty resilient. We have weathered the storm,” he said.
However, the storm is getting worse. It’s not just Nat CAT rates and severity that have been rising, but the number of claims arising from strike, riot and civil commotion rose by 3000% over the past two decades. Population growth plays a significant role in this surge, especially in urban areas, which leads to social tensions and a heightened risk of civil unrest.
“To revolutionise, we must have the right tools at hand. There has been a lot of model uncertainty, which leads to loss creep. The root cause is the lack of data on up-to-date exposures and current risk values,” he said. “The awareness is there, but the quantification is not really understood.”
Giving up profit for good
With booming populations in metro areas and the tendency to build in high-risk areas such as along shorelines and on floodplains, insurers must engage politically in order to improve resilience and reduce volatility, said Munich Re member of the board Achim Kassow.
He also noted that the industry needs to be prepared as an insurance and reinsurance sector to give up the business it considers profitable.
“Part of the debate will always be political,” he said. “If the private sector should have the opportunity to make money on something, or alternatively serve a public good, then that is the choice that should be administered.”
While government pools exist and provide the capacity that people require, being silent for fear of government intervention is the wrong attitude, he said. “Even if we might lose business for a certain period of time, it’s also pretty clear that these pools will see losses and the taxpayer will then be called to pay for it, and that will provoke the next discussion. Then you get to a sustainable solution.”
He also said that the industry shies away from having difficult conversations about habitable and insurable areas. “But I think, as an industry, we must have clear standards based on facts and say, ‘no, this isn’t going to work anymore’. Even if we could rebuild better, this place is unsustainable. And because we have the relevant information, we can provide that clarity.”
Fighting for talent
Partner Reinsurance Asia CEO, Asia Pacific P&C and CEO James Beedle kicked off a panel on the fight for talent with a preamble about the increasing importance of recruiting and retaining staff as more senior talent is leaving the sector through retirement at a time that it is struggling
to recruit younger staff – in part because it is seen as ‘being boring’.
“You’re not alone,” said Selion Global founder and global managing partner Thomas Hofer. “It’s not just an insurance challenge – many people left during the pandemic and never came back.”
Munich Re regional head of HR (Asia Pacific, Middle East and Africa) Moira Roberts echoed this sentiment and said, “The industry is not good at selling itself, branding itself. There is a degree of humbleness in the industry.”
“The insurance industry is seen as boring and conservative,” said AIA Singapore chief executive officer Wong Sze Keed. “People associate life insurance with agents that only hassle you to buy insurance. We don’t do enough to create awareness.”
Glamour of reinsurance
During the same panel Guy Carpenter senior VP, global operations Valerie Badcock said, “Reinsurance is the glamorous side of insurance. Rebranding is something we should all be considering. We need to promote ourselves better. We need to open the doors.”
In terms of attracting new talent, she said, “We need to be looking at a multifaceted method of getting staff – starting at graduate level – but also introducing an apprentice scheme for 18-19-year-olds. We should always be looking at attracting the best talent from universities – and not just from finance and economics courses. We also need to be focusing on female talent.”
Ms Roberts indicated that Munich Re had, “started in employee branding” focusing on real staff in real countries showing the diversity of talent it employs.
“It’s about personalisation – about selling the benefits of working in insurance. Hybrid working is a huge factor in attracting talent,” she said and reinforced that this needs to be part of a long-term plan. It is not a quick fix for a short-term problem – and it can be expensive to implement properly.
“It’s not cheap, which is why you need to think it through,” she said.
The Singapore International Reinsurance Conference took place from 4 to 7 November with Asia Insurance Review as the official media partner. A