Stock photo. Credits to Unsplash.

Higher insurance claims lead to underwriting pressure for APAC reinsurers

S&P said APAC reinsurers showed slower growth and subdued underwriting margins.

Asia-Pacific reinsurance sector faces increasing downside risks amid global headwinds, a report by S&P Global revealed.

Based on its analysis of 15 Asia-Pacific reinsurers, slower growth and subdued underwriting margins is signalling increasing downside risks for the sector. 

S&P said that reinsurers’ earnings face pressure from subdued underwriting results and declining investment margins. This is due to ongoing market volatility, rising inflationary pressures, and ever-rising natural disaster claims that will dent earnings potential over the next two years.

ALSO READ: Is climate risk getting too hot to handle for reinsurers?

“We forecast premium growth for rated Asia-Pacific reinsurers to be in mid-single digits as they benefit from underinsurance within the region and hardening of global rates amidst macroeconomic headwinds,” Trupti Kulkarni, an insurance analyst at S&P Global Ratings said.

Asia-Pacific reinsurers also have weaker underwriting performance than the top 21 global reinsurers.

“APAC reinsurers are highly dependent on investment returns to cushion underwriting shortfalls compared with top 21 global reinsurers. Global headwinds should reduce investment returns over the next 12–24 months,” Kulkarni said.

Join Insurance Asia community
Since you're here...

...there are many ways you can work with us to advertise your company and connect to your customers. Our team can help you dight and create an advertising campaign, in print and digital, on this website and in print magazine.

We can also organize a real life or digital event for you and find thought leader speakers as well as industry leaders, who could be your potential partners, to join the event. We also run some awards programmes which give you an opportunity to be recognized for your achievements during the year and you can join this as a participant or a sponsor.

Let us help you drive your business forward with a good partnership!


Markel targets professional indemnity market in Australia
Head of professional and financial risks, Kym Beazleigh, explains the game plan in Markel’s strategic expansion.
Natural disasters steer Asia Pacific towards parametric insurance
Swiss Re gives importance to parametric insurance amidst challenges like basis risk and modelling complexities.
InterContinental Singapore is saving insurance for a rainy day
NUS Professor Charoenwong discusses the effectiveness and value of a Singaporean hotel’s rain insurance offer.