Insurers will continue to have to deal with regulatory and financial reporting changes, specifically the advent of IFRS 17 and ESG reporting, says Mr. Brandon Bruce, ASEAN Insurance Leader at the global professional services firm EY.
Outlining the outlook for the insurance sector for 2023, he said, “Some of the main issues impacting insurance companies in Southeast Asia include rising interest rates, which will potentially affect premium income growth in 2023, as well as rising inflation and pressures from the cost of medical supplies and other goods increasing the cost of claim payouts.”
Data and technology
He added, “The fact that more and more insurers in the region are looking at technology, data and analytics capabilities as enablers to modernize and push their businesses forward is definitely a bright spot to look forward to.”
Mr. Bruce also said, “As companies look to keep costs under control, we’ll likely see them putting additional focus on ensuring more seamless services by enabling technology across the delivery chain, as well as re-strategizing the distribution base by enriching product offerings to the customer directly and via digital sales portals. Insurers will also maintain stringent claims management and controls and implement new tools to understand where the leakages are and plug them by understanding the drivers and main causes creating them, introducing better analytics capabilities and tightening processes.
“Looking ahead, it will make a lot of sense for insurers to consider investing for a stronger digital presence. However, the problem with digital — sexy as it may sound — is that you must get the model right, partner with the right ecosystem providers, provide the right solutions and the right product suite that will cater to the clients’ needs.”
M&A activities in 2023
Mr. Bruce predicted, “M&A in the industry will continue, with emphasis on stronger incumbents or new market entrants building a solid business in this part of the world, either by acquiring legacy businesses or via joint venture tie-ups.”
Source: asiainsurancereview.com