Singapore regulator praises role of captives
Ravi Menon, the managing director of the Monetary Authority of Singapore, has praised the work that has been done in Singapore in recent years to make it a thriving jurisdiction for captives.
Speaking in an official keynote address at the start of the 2023 Singapore International Reinsurance Conference (SIRC), taking place this week, Menon noted that there is now a growing number of captive insurance companies in the APAC region – and that the reinsurance industry can be a strong and crucial partner for captives.
There were 82 captives in Singapore at the end of 2022, he pointed out. Singapore is becoming more receptive to listening to and dealing with demand for captives, he said.
He also noted that reinsurance can also help risk pools & help with risk modelling, which is important as nat cat losses continue to be a big challenge. Some insurers have become more selective in the risks that are being covered, a challenge that better risk models can overcome.
In this vein, he also highlighted the importance of better risk models, in the context of the many natural catastrophes that Asia is exposed to. He noted that much of Asia lies in or near the Ring of Fire, one of the most tectonically active places on earth, making it vulnerable to earthquakes, volcanoes and tsunamis.
Partly in this context, the penetration gap in the region remains a massive challenge, he reminded delegates – but also stressed the scale of this opportunity. He said it is crucial that the industry continues to innovate, developing new products covering new risks that can leverage new opportunities.