Singapore targets insurance innovation with new protected cell company framework

Singapore is set to strengthen its position as one of Asia’s leading insurance and reinsurance hubs through a new regulatory framework designed to expand risk-transfer capacity and support insurance innovation.

Speaking at the Association of Banks in Singapore (ABS) annual dinner, Deputy Prime Minister and Monetary Authority of Singapore (MAS) Chairman Gan Kim Yong highlighted the growing importance of resilience in an increasingly complex risk environment, where disruptions can rapidly spread across sectors and borders.

“Risks today are more complex, more connected, and harder to price,” Gan said, noting that Asia remains significantly underinsured despite its economic growth.

To address this gap, MAS will soon launch a public consultation on introducing a protected cell company (PCC) structure, a move aimed at deepening Singapore’s role as a centre for insurance, reinsurance and alternative risk-transfer solutions.

According to Gan, the structure will deliver “greater flexibility, lower cost and more efficient risk transfer”. It is expected to make captive insurance arrangements more accessible for corporates and simplify the issuance of insurance-linked securities (ILS), enabling sponsors to transfer risk to capital markets more quickly and cost-effectively.

The announcement reflects Singapore’s broader ambition to become a hub not only for traditional insurance and reinsurance, but also for alternative forms of risk financing. 

Gan argued that traditional underwriting capacity alone would be insufficient to meet the region’s growing protection needs. Instead, future growth would favour financial centres capable of combining underwriting expertise, reinsurance capacity, alternative capital and flexible risk-transfer structures.

“The financial centres that can bring together underwriting expertise, reinsurance capacity, alternative capital and flexible risk-transfer structures will be best positioned for growth,” he said.

The PCC initiative forms part of a broader strategy outlined by Gan to reinforce Singapore’s role as a “trusted connector” in global finance. Alongside efforts to develop growth capital markets and strengthen gold trading infrastructure, the PCC proposal aims to build the trusted market infrastructure needed to support Asia’s next phase of economic development.

“By enabling more alternative risk transfer solutions, the PCC framework will complement the traditional reinsurance market, expand risk capacity, and deepen Singapore’s role as a hub for insurance and risk solution innovation,” Gan said.

Further details of the consultation are expected in the coming weeks.

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