A single market for the Association of South East Asian Nations (ASEAN), also known as the ASEAN Economic Community (AEC), will greatly benefit the growth of general insurance premiums across the region, according to regional market research publication ASEAN Insurance Pulse.
The AEC, which was established in 2015, is an important milestone in the economic integration of the Southeast Asian region. The market value of the region is estimated to be at US$2.6 trillion with a population of 622 million people.
According to the report, the region’s integration presents a good opportunity for the US$23 billion general insurance market. Insurance penetration is quite low in the region, at around one-third of the global average.
Almost two out of three executives polled by ASEAN Insurance Pulse expect general insurance premiums to match or even exceed gross domestic product (GDP) growth over the next year. Meanwhile, 86% of respondents are receptive of a common regulatory framework in ASEAN, which would serve as a counterweight to the intensified competition brought about by increased liberalisation in the region.
“The ASEAN Insurance Pulse shows very clearly that the AEC integration is viewed positively by the ASEAN insurance community. The executives polled expect a major boost to their markets through enhanced competition, innovation and governance,” said Dr. Kai Uwe Schanz, the study’s author and chairman and partner of Dr. Schanz, Alms & Company, one of the publishers of ASEAN Insurance Pulse.
Malaysian Re, the country’s national reinsurer, co-published the report.
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