Room for growth in Asia's insurance market

Room for growth in Asia's insurance market
By Millet Enriquez | Posted: 18 July 2011 2306 hrs

SINGAPORE: Asia's insurance market is still largely untapped and industry players must continue to develop talents and understand the risks in the market.

That's according to Deputy Prime Minister and Minister for Finance and Manpower Tharman Shanmugaratnam who spoke at the launch of the new offices of French insurer AXA on Monday.

While Asia's insurance premiums are expected to grow 10 per cent yearly, the minister said longevity, environmental and socio-economic risks are also rising.

French insurer AXA is keen to expand its business in Singapore and Asia.

As part of its growth plans, AXA unveiled its new offices that will house more than 600 of its staff in general and life insurance. Located at 8 Shenton Way, the AXA Tower stands 235 metres with 52 storeys.

AXA is also looking to grow its 2 per cent share in the life insurance market currently dominated by Prudential and AIA in Singapore.

John Dacey, AXA group vice chairman for Asia Pacific, said: "We think we can be the top three players in Singapore life insurance market in the long term.

"We are not there today and we would like to become there. I think in general insurance, we are already towards the top."

AXA commands a 9.5 per cent market share in general insurance with health, cargo and motor as its main products.

For its expansion in Singapore, AXA plans to grow its advisers to 1,000 by 2012.

It will seek partnership to expand its life insurance market and launch new products that offer financial protection and disability and death benefits.

Last year, the life insurance industry saw around S$1.6 billion worth of new business premiums, according to data from the central bank and the trade industry - growing 16 per cent on-year from S$1.4 billion in 2009.

Still, industry studies show most Singaporeans are under-insured.

AXA is also focused on building its presence in Asia, where insurance premiums are expected to grow 17 per cent to US$957 billion in 2015.

But it must be prepared to face the challenges.

Mr Tharman said:"What's important for us is to position ourselves to take advantage of this, not just from the point of view of grabbing business because it's out there and growing.

"Take advantage of it by deepening skills and capabilities so as to develop better solutions for Asia going forward. Developing your people is critical and investing in research is equally critical."

So far, Indonesia and Thailand are AXA's key Asian markets for life insurance where it enjoys market share of 16 and 6 to 7 per cent, respectively.

- CNA/ck

- wong chee tat :)