China's reduction in capital charges for equity investments by insurers is likely to drive them to increase their equity holdings, Fitch Ratings said. However, equity investments expose insurers' earnings to the swings in the stock market, which could put pressure on some insurers' capital positions.
The Taiwan dollar's sharp rally against the US dollar in the first week of May has heightened foreign exchange risk exposure for Taiwanese life insurers who have been allocating a large portion of their invested assets in foreign investments, mainly USD-denominated fixed income securities.
Investment solutions company Amundi has appointed Mr Jian Xiong as insurance specialist for Asia. In his new role, he will strengthen the development of investing offerings and bespoke solutions for insurance clients across Asia.
Income Insurance, a composite insurer in Singapore, has selected JP Morgan as the custodian bank for its assets.
China's insurance sector has made a significant move into gold investments. Recently, China Life became the first domestic insurer to complete a gold transaction on the Shanghai Gold Exchange, signaling the official rollout of insurers' gold investment strategies.
These are the updates on insurance regulation across China this week.
Global gold prices have been soaring in recent years, repeatedly hitting record highs. Meanwhile, Chinese insurers have been struggling with a "shortage of investable assets." The downturn in real estate prices and local government debt restructuring has significantly reduced their allocation to alternative assets, leaving them with limited options in bonds and equities. This lack of investment channels has constrained returns on insurance capital.
Since 2023, Chinese InsurTech companies have actively sought listings on US and Hong Kong stock exchanges. While some, like Cheche Technology and U-Bx Technology, have successfully gone public, many others have faced delays or suspensions in their IPO processes.
Prudential has appointed Mr Ray Farris as chief economist. In this new created role, he will drive economic analysis and insights for both Prudential and Eastspring Investments, Prudential's asset management arm.
Sun Life has appointed Mr Benjamin Deng as president of Asia asset management, effective 1 January 2025. He will join Sun Life's Asia Executive Team in this newly created role.