Singapore will take the lead in assisting Asian economies, particularly in the ASEAN region, to tackle cyber risk and will set up the world's first cyber risk insurance pool with a capacity of $1bn.
The pool will be established in collaboration with the Singapore Reinsurers’ Association and cyber specialist Peter Hacker and has already received interest from 20 insurance companies.
Singapore’s Minister for Finance, Heng Swee Keat announced this in his keynote address at the opening of the 15th Singapore International Reinsurance Conference (SIRC) yesterday. He mentioned how Asia was most vulnerable to cyber attacks and how more than 60% of Asian companies did not have any cyber security in place. “We need to invest in cyber security to prevent and deter attacks, and also mitigate the consequences of attacks through better risk pooling,” he said.
Global-Asia Insurance Partnership
Mr Heng also announced the setting up of the Global-Asia Insurance Partnership that would drive a strategic response to tackle long-term challenges and coordinate cross-cutting issues across the different industry segments within and outside the insurance sector, as well as draw synergies across industry, policymakers and academia. “We need to collectively pool expertise and co-create innovative solutions in pertinent issues such as digital innovation, talent and government policies,” he said.
The minister said that through this centre of excellence, the goal is to set up:
- a living lab that would develop solutions for new risks;
- a regulatory think tank that will conduct independent research to support policy decisions that would help in mitigating risks; and
- a talent development pillar that will train a pipeline of insurance talents with cutting-edge skills in emerging areas like big data and artificial intelligence.
The world’s eyes are on Asia
American International Group’s President and CEO, Brian Duperreault, in a fireside chat with the BBC’s Rico Hizon spoke of the huge opportunities that exist in Asia for insurers due to the region's high GDP growth and low insurance penetration.
“China and India present huge opportunities and so do countries in the ASEAN region and also Japan and so companies need to have a special strategy for Asia,” he said.
He mentioned too that InsurTech firms are making the whole process of insurance buying easier for the end buyer. He said, “The ultimate value for the industry is coming from AI, data science and the development of algorithms that are making things more efficient for the industry.”
Yet, InsurTech firms are not willing to take the risks, an opportunity which is passed instead onto traditional insurers.
Mr Duperreault mentioned that AIG is ready to splurge on a company that complements its business and it is always on the lookout for such acquisitions. “Acquisitions will happen around the world as it is a natural way of survival of the fittest and I would pick up a company that complements our business and is in synergy with us in terms of technology, people and processes,’ he said
Sold out event
This year’s SIRC has broken previous records in delegate numbers with 1,027 registered from 50 countries including for the first time from Tonga, Panama and St Kitts and Nevis. The numbers are almost at par with the annual Monte Carlo Rendezvous and reveal how important Asia is in driving world insurance growth.
The SIRC, which takes place from 29 October to 1 November 2018, is organised by Singapore Reinsurers’ Association in conjunction with the Reinsurance Brokers’ Association of Singapore, as well as Asia Insurance Review as the official media partner.