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May 2022

Asia Pacific: Increased supervision, market volatility and low interest rates to continue to challenge life insurers in 2022

Source: Asia Insurance Review | Jan 2022

Increased regulatory scrutiny, heightened market volatility and the continuing low interest-rate environment will continue to heap pressure on life insurers across the Asia Pacific in 2022, say Clyde & Co partners Joyce Chan and Ganga Narayanan.
 
The lawyers said, “Smaller to medium-sized local insurers are likely to face the most challenges and we foresee some divestments of assets as a consequence – predominantly from multinational groups or regional life insurers siphoning off less profitable books or divesting assets in jurisdictions where they lack scale.”
 
The writers’ insight is shared in an article that is a part of the global law firm’s “Insurance 2022 - the year ahead” series on the trends and issues that are likely to impact the insurance industry next year. The series is carried on Clyde & Co’s website.
 
The two writers also said, “Strategic partnerships with social media and lifestyle platforms, loyalty programmes and online retailers will continue to be popular in Asia as a means for life carriers to access new distribution networks and introduce new product branding. The emphasis is typically on simpler, short-term products, such as medical coverage with life insurance elements.
 
“High net worth (HNW) type products will continue to be a thriving market in Asia, as HNW individuals increase in number, and volatility in the investment markets leads them to seek more stable returns through life insurance products.” A 
 
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