The Non Life Insurance Market in Singapore experiences a slow growth: Ken Research
Posted on 03 February 2017 by KenResearch Banking Financial Services and Insurance,
Ken research announced its recent publication on “Non-Life Insurance in Singapore Key Trends and Opportunities to 2020'”. The report gives a comprehensive analysis on the non life insurance sector of Singapore. The report provides an in depth analysis on size, growth, major segments, and leading players in this insurance market in Singapore. It uses eve forces of analysis to determine the sector’s competitive intensity and therefore attractiveness. Additionally the report has profiles of leading companies that reveals details of key non life insurance market players' global operations and financial performance
Singapore has a GDP of USD 307.872 bn and is ranked 36th in the world (The World Bank statistics). The industry sector occupies 25% of the GDP while the service sector has 75%. The inflation rate and unemployment level is low and stable. Its corporate tax rate is at 17%, the lowest in the Asia- pacific region. It was the first Asian nation accreted with the AAA rating. The strength of this economy lies in its stable political and sound economic system. The nation is known for its excellent business environment and banking sector. Singapore has emerged as a high income country that is major trading regional and global hub for financial and trading services. Thus, this nation has become one of the very few nation ,which has current account surplus, ample foreign reserves and very low public external debt. However, on the other hand Singapore is highly dependent on exports, has a quite volatile.
The nation has a multiracial and multicultural population but is dominated by people of Chinese ethnicity. The fertility rate is quite low, around 1.25 and has been a concern for the government. The literacy rate ( 97%) is one of the highest in the world and the unemployment rate is low. The average life expectancy is approximately 83 years . The per capita income at USD 52,000 in terms of PPP is the third highest in the worlde economic growth, paucity of highly skilled professionals and very high old age dependency ratio.
Singapore has the most open insurance sector in the world and is fully open to foreign insurers. The MAS (monetary authority of Singapore) regulate the insurance market. This industry is currently in its boom phase as the investment and returns have been growing leaps and bounds. The introduction of FAIR ( Financial Advisory Industry Review) which has brought more transparency in production and sales . The MAS has also recommended direct purchasing of the insurance product to combat rising operating cost and help to attract and retain talent. This move has drawn some flak from people citing that the nation is not ready for such a thing as yet but many insurance companies has supported this thought. Insurers can carry their business in Singapore as licensed insurers or foreign insurers. Licensed insurers can carry on direct life and/or general business, life and/or general reinsurance business or captive insurance. Foreign insurers operate in Singapore under a foreign insurer scheme established under Part IIA of the act There are two foreign insurer designs- The Lloyd's Scheme and the Lloyd’s Asia Scheme.
The general insurance business covers a wide range of risks such as fire, marine and aviation, motor, workmen's compensation and public liability. For the last fiscal year , the market grew by marginally and the profits fell slightly. This market is dominated by the motor insurance sector. The major motor insurance providers are Aviva and DirectAsia.com . There are many companies in this sector but is dominated by the Americans.
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Ankur Gupta, Head Marketing & Communications