Insular Life (InLife) and Singapore-headquartered Oona Insurance Group (Oona) have announced jointly that they are entering into an agreement, with InLife selling its 40% stake in their non-life insurance joint venture, Oona Insular Insurance Corporation (Oona Philippines), making it Oona's fully owned subsidiary. InLife is the first and largest Filipino life insurance company in the country. Oona Insurance which offers a digital general insurance platform for Southeast Asia. It is focused on building the most transformative and customer-centric insurer across the region. Set up in 2021, it has established a presence in Indonesia and the Philippines and is fully backed by a $350m equity commitment from Warburg Pincus. Following the completion of the deal, Oona Philippines and Insular Life will continue their cooperation arrangements to cross-sell insurance products in the Philippines. The agreement is expected to further boost Oona Philippines’ status in the general insurance industry, building upon the series of innovations and services that it has brought to the Philippine market since it set up shop in the country last year. InLife, on the other hand, will focus on its core life insurance and healthcare business to sustain the momentum it has achieved in the last couple of years. InLife plans to support its scale and innovation efforts in its operations and distribution channels in its bid to move further up the rankings. “As InLife moves forward to achieve accelerated growth and continue in its journey to provide customer service excellence through digital transformation and innovation, we will continue to support Oona’s plan to strengthen its presence in the Philippines,” said Ms Nina D Aguas, Insular Life’s executive chairperson. Commenting on the acquisition, Mr Abhishek Bhatia, founder and CEO of the Oona Insurance group, said, “We are very optimistic and believe this move will help us push for higher growth as we position ourselves to be a major player in the Philippines’ non-life insurance market.” Source: asiainsurancereview.com

The insurance industry and the business community in ASEAN are at a crossroads of transformation, with ASEAN remaining as a symbol of dynamism and resilience amidst all the headwinds and tailwinds of financial uncertainties. Speakers at the fifth ASEAN Insurance Summit discussed the ways and means to accelerate the transformation and sustainability of the ASEAN Insurance Industry. “Public and private cooperation should be emphasized which has proved successful in dealing with the COVID-19 pandemic. Now, we continue to be confronted with new challenges and risks. The private sector must work together with the government to bring various sustainability initiatives to fruition,” said ASEAN Insurance Council secretary-general Christian Wanandi in his opening remarks to the Summit. “With the support of the industry, regulators are adopting policies and implementing safeguards to strengthen the ASEAN insurance industry,” he said. ASEAN continues to shine as an economic powerhouse “The ASEAN region has successfully navigated through the economic impact of the global pandemic. After the remarkable rebound of 5.7% in 2022 in our GDP growth, ASEAN continues to shine as an economic powerhouse, with economic growth projection of 4.6% and another 4.7 to 4.8% for the year 2024,” said ASEAN Economic Community deputy secretary-general Satvinder Singh in his special address to the Summit. “Therefore, it is showing buoyancy, driven by the robust domestic demand and all the continued recovery we have seen in all the major sectors of trade, including tourism,” Mr. Singh said. In speaking about evolving landscapes, Mr Singh said, “There are two emerging trends that are forging our visionary path in the future. One is that of sustainability and the other is digital transformation”. “ASEAN has harnessed digital transformation to help accelerate economic growth. This year in September, economic and ASEAN leaders formally launched the negotiations for the digital economic framework agreement which is to build a seamless, secure and inclusive digital trade ecosystem across the region,” he added. ASEAN Insurance Pulse Highlights: Impacts of inflation on ASEAN insurers Malaysian Reinsurance Berhad (Malaysian Re) launched the seventh edition of the ASEAN Insurance Pulse at the Summit, which is dedicated to the topic of inflation and its impact on the ASEAN insurers. As stated in the key findings of ASEAN Insurance Pulse 2023, the surge in inflation coined much of 2022, resulting in a tightening of monetary policy – and in turn – capital market volatility and a depreciation of currencies in some emerging markets. For insurers, inflation caused challenges on the underwriting and on the investment sides, in operations and contributed to a tightening of reinsurance capacity. Inflation did not affect all ASEAN insurers equally across the ASEAN markets and in fact varied greatly according to their business model. Those with a high share of personal lines as motor, property and medical insurance were the most affected than those focused on commercial lines or in reinsurance. “The ASEAN region, which consists partly of emerging and partly of mature markets, is no stranger to inflation. Nevertheless, complexity, speed and the altitude to which inflation surged within just a few months, present a novelty to most of us in this industry,” said Malaysia Re president and CEO Ahmad Noor Azhari Abdul Manaf. “We had anticipated the impact of inflation on claims on our books in 2022. The large losses from the Eastern Australian floods in 2021 had served as an eye-opener for the impact of inflation on claims payments, as we could see its effects on the cost for replacement materials as well as triggering a shortage in construction workers and thus causing further costs,” said Mr. Ahmad. The fifth ASEAN Insurance Summit was held on 5 December 2023, organized by the ASEAN Insurance Council (AIC) and the Singapore College of Insurance (SCI), followed by the 26th ASEAN Insurance Regulators' Meeting (AIRM) and the 49th ASEAN Insurance Council (AIC) meetings from the 6-8 December 2023, in Ha Long, Vietnam. Source: asiainsurancereview.com

The impact of inflation on ASEAN insurance markets was less than in mature Western markets, as inflation in Southeast Asia was on average lower than in the US or the EU, according to the "ASEAN Insurance Pulse 2023" report. The Russia-Ukraine war, for example, had less of an impact on ASEAN markets, and labour markets were not as tight as in Europe, says this 7th annual edition, released by Malaysian Re. The 2023 edition focuses on the impact of inflation on the ASEAN insurers and how they tackled this challenge. ASEAN insurers not equally affected by inflation Inflation rates in ASEAN varied widely, with Vietnam, Brunei, and Malaysia at the lower end with less than 5%; and Myanmar and Laos at the upper end with close to or even above 20%. In some ASEAN markets, inflation increased while local currencies depreciated, leading to higher costs for imports and thus increasing insurers' payments. Currency depreciation had a strong impact, with mature economies like Singapore trading in line with the major global currencies, while Malaysia, Indonesia and the Philippines depreciated significantly. Inflation affected insurers differently, depending on their business model. Non-life insurers with a bias toward personal lines, particularly motor and property business, were likely to be hit hardest as higher costs for raw materials, spare parts, repair and labour drove up claims ratios. Medical insurers had to digest rising costs due to inflation too. For ASEAN affiliates which have their assets mostly managed at group level, the impact of inflation on their investment portfolio had less of an effect than for those, which had to realise losses on their bond portfolio due to losses on the underwriting side. And finally, the cost of operations varied greatly with insurers in markets such as Singapore spending a larger share of their budget on rising salaries. Overall, AM Best concludes that the ASEAN insurers fared quite well, proving their preparedness and resilience. Impact of inflation perceived differently The consensus is that inflation is a “relevant” challenge, but part of a flurry of different headwinds which hit the markets all at the same time. Inflation did not catch insurers off guard. It had already started to rebound before the end of the pandemic and in some ASEAN markets, had been part of their reality for quite some time. In addition, insurers had risk management measures in place to stress-test the impact of inflation on their book and reserves. However, a major concern was with policyholders, namely consumers, who often underestimate the risk of underinsurance. Claims costs were the biggest concern for insurers. However, the effect of deteriorating claims ratios was dwarfed by the tightening of reinsurance markets since the year-end renewals in 2022. Insurers partly interpreted the hardening as a consequence of inflation, caused by the abrupt increase in interest rates and reinsurers´ costs of capital. Insurers' investment returns were affected by the same token – the tightening of monetary policy led to a decline in fixed-income securities and thus to rising unrealised – and in unfortunate cases also some realised losses. The top line was affected too, as higher sums insured drive premium volume. However, clients hit hard by rising prices might reduce their insurance buying. Personal lines most affected Motor, property and medical insurance were the lines most affected. According to some ASEAN insurers, prices for motor spare parts rose due to a combination of inflation and higher import costs by as much as 30% to 40% in some markets. Similarly, construction costs were up by 20% to 30%. In medical insurance, insurers saw a continuation of the double-digit medical inflation that markets had already witnessed for some time. Due to higher import and labour costs, medical inflation accelerated further. Reserves, however, posed no major concern. The lines most affected are mainly short-term liabilities, while long-tail risks are less affected. In addition, insurers had prepared for inflationary pressure, slightly adjusted reserves, and tested their adequacy regularly. In times of inflationary distress, consumers tend to regard insurance as a dispensable cost which they limit by buying less coverage, cancelling insurance or resorting to self-insurance. This affects particularly the personal lines. In case of underinsurance, clients might declare a reduced property value – thereby taking the risk of underinsurance. Lower insurance spending may also affect the commercial lines, as inflation plus tighter rates and commissions force policyholders to reduce coverage. Opinions diverged regarding the relevance of underinsurance. In some cases, insureds might lack the understanding or awareness to adjust premiums to the rising value of their assets. However, at least larger corporations will increase their sum insured to reflect the impact of inflation. Insurers made quite some efforts to ensure that clients remained properly insured. For policies that do not renew and adjust automatically or include escalation or inflation clauses, insurers launched educational campaigns explaining why premiums must rise. Insurers' response Insurers reacted with a mix of measures to combat the impact of inflation on their underwriting portfolio. Price increases were the most frequently mentioned feature, affecting foremost motor and property – unless tariffed. Tighter market conditions were reflected by a hardening of terms and conditions – partly due to the developments in reinsurance. Insurers demanded that clients disclose how they manage their risk and asked for an updated valuation of assets to adjust the sums insured. Furthermore, insurers pruned their portfolio and reallocated capacity, often shifting from severity to frequency risks to reduce the amount of reinsurance cover needed. The quality of the account was a dominant theme with insurers systematically screening their portfolio, increasing deductibles to force clients to better understand their own risks. Ultimately, many claimed to have shed risks that they felt were not meeting their requirements. The findings of the report are based on 24 structured interviews with executives representing regional and international (re)insurance companies, intermediaries, policymakers and trade associations. The interviews were conducted by Faber Consulting, a Zurich-based research, communication and business development consultancy, from July to August 2023. Source: asiainsurancereview.com

The accelerating climate change can increase the likelihood of widespread disruptions to the financial sector, including the insurance sector according to a new report released by the Bank for International Settlements (BIS). The new 50-page report Too hot to insure – avoiding the insurability tipping point released by the oldest international financial institution in November 2023 said while the global efforts to transition to net zero greenhouse gas emissions are commendable, their impact in slowing climate change is still uncertain. The report said, “A major complicating factor is the uncertainty over future climate change impacts, which may unleash extreme events that have not occurred in the past for example due to climate tipping points.” Moreover, insurers aren’t generally making climate considerations explicit in their pricing and underwriting policies. Also, a growing number of insurers is retreating from high-risk areas. The trend is likely to continue as insurers become better aware of climate related risks and incorporate these risks in their pricing and underwriting approaches. The report said, “There is a chance that the global average temperature increase target under the Paris agreement could be breached, pushing the world, the global economy and financial systems into uncharted territory. “Efforts to facilitate a swift transition to a sustainable economy, including adequate risk adaptation, mitigation and coverage by economic agents, are therefore vital. Through their pricing and underwriting policies, insurers play an important role in both supporting climate risk mitigation efforts to transition to net zero, as well as in incentivizing risk adaptation measures.” the report said. It said an increasing number of insurers are publishing transition plans that set out how they intend to support climate risk mitigation, including adjustments to their underwriting policies. Some insurers are also pulling out from insuring greenhouse gases intensive sectors, and they do so in a gradual manner, recognizing that some high emitters are taking steps to reduce their emissions. At the same time, insurers can incentivize climate risk adaptation efforts through their pricing and underwriting policies by recognizing risk reduction measures in terms of reduced premiums or more favourable policy terms. Nevertheless, the insurance industry alone cannot mitigate climate-related risks – other actors such as governments, households and businesses need to play their part. Source: asiainsurancereview.com

The perceptions of business risks, from supporting staff to ESG regulation and economic uncertainty, are changing the global business risk landscape according to a new report by specialist insurer Beazley. The new report Spotlight on: Business Risks 2023 published in November 2023 has revealed that despite a challenging macro environment, business leaders are increasingly looking inwards at challenges related to managing staff and employees despite the growing threat of external risks facing global boardrooms. A press release issued by Beazley said the employer risk doubles with 22% of global business leaders saying this risk is the number one threat facing their organization this year, doubling from 11% in 2021. Yet, 1 in 4 (27%) boardrooms feel ill-equipped and unprepared to deal with it. As ESG regulation mounts, 1 in 4 (26%) global business executives feel unprepared to anticipate and respond to ESG risks. As the risks become greater for businesses, the research shows that almost half (42%) of global business leaders believe they will be operating in a high-risk environment in six months’ time, up from 31% this year. The report reveals that perceptions around business and executive risks, from employee risk to reputation management to ESG regulation, are changing the risk landscape for business leaders and over a third (35%) of global executives now plan to explore insurance options that include risk and crisis management as business challenges mount. The data, based upon a survey of 2,000 global business leaders by research company Opinion Matters, reveals that among the challenges organizations are grappling with, the growth of the #MeToo movement and a welcome increase in staff reporting workplace issues has led to a rise in allegations being made, and these factors appear to be drivers of concern. Additionally, a worsening of staff mental health post-pandemic has placed a greater emphasis on workplace support initiatives. Worryingly, 1 in 4 (27%) executives surveyed said they feel ill-equipped and unprepared to deal with today’s employer risks. Business leaders surveyed believe managing their reputations will become increasingly tough in the coming months, with 17% ranking this as their top risk today, rising to 19% in 2024. Beazley group head of specialty risks Bethany Greenwood said, “Global business leaders are dealing with a challenging array of new and persistent risks that threaten their business models. It might seem counter-intuitive that executives are increasingly looking inward at their workforce and workplace to meet today’s challenges.” The research shows that failure to comply with new ESG-related requirements, including related legislation or reporting requirements, is of greater concern for business executives in the US and Canada than in the UK and Singapore. Source: asiainsurancereview.com

ANDREWS meeting on Agricultural and State Asset Insurance held at Bao Viet headquarters on December 4, 2023 in Hanoi, Vietnam. Among the attendees were PIRA Chairperson Eden Tesoro, and PIRA Executive Director Michael Rellosa.

The fragility of our world order and the hazards inherent in an increasingly interconnected world have been highlighted by events such as the COVID-19 pandemic, President Putin's invasion of Ukraine and global economic slowdown in the recent years. A survey which is part of a new report by Geneva Association shows that customers across the world’s six largest insurance markets (the US, China, Japan, UK, France and Germany) are concerned about future insurability – particularly for natural catastrophes, longevity and cyber risk. The survey found that over 50% of respondents expect it will become more difficult or impossible to get insurance. The new report The Value of Insurance in a Changing Risk Landscape says the existing volatility is expected to persist into the coming decades as geopolitical uncertainties grow, climate risks intensify and technology continues to advance rapidly. It says these trends are driving up systemic risk, challenging the traditional insurance business model of risk pooling and redistribution and, as we are already witnessing in some regions with climate risks, making insurance prohibitively expensive or – even worse – unavailable. The report advises that by providing services that go beyond traditional risk transfer – such as risk prevention services – and collaborating with governments to address the most severe risks, insurers can continue to safeguard societies in the face of a more complex and challenging risk landscape. The survey findings provide strong support for these approaches, with more than 80% of customers expressing interest in non-traditional risk services. The Geneva Association managing director Jad Ariss said, “The increasing intensity and impact of risks today, from climate to cyber, are creating testing conditions for insurers. Yet the case for the continued value of insurance is clear. By leveraging their expertise to offer services that help to mitigate risk and drive positive change among their customers, insurers can maintain, and even strengthen, their societal relevance.” The GA director socio economic resilience and author of the report Kai-Uwe Schanz said, “Our theoretical analysis found that climate and cyber risks in particular present major obstacles to insurability. Interestingly, they were also two of the top risks cited by customers when it comes to concerns around the unavailability and unaffordability of insurance. He said, “Encouragingly, our survey results also reveal considerable appetite among customers for additional risk services – such as prediction and prevention services – indicating a clear opportunity for insurers to expand their offerings.” Source: asiainsurancereview.com

By Junep Ocampo The headlines are stark and harrowing: "4 dead in Marcos Highway crash." A car collides with a man and two motorcycles, resulting in two deaths and three injuries. It's a litany of shattered dreams, a seemingly endless narration of tragic stories that demand attention. The urgency of the situation is prompting a critical question to all: Can something be done to address this crisis on Philippine roads? MICHAEL RELLOSA Responding to the challenge, insurance companies in the Philippines are uniting to confront the pressing issue of road safety. Their collaborative efforts aim to tackle the crisis head-on through a multisectoral campaign that combines education, enforcement, and engineering. The goal is clear: to lessen, if not completely stop, the alarming trend of road fatalities in the country. Government statistics are alarming—around 11,000 people die on Philippine roads annually, with a significant number of them being pedestrians falling victim to vehicular crashes. Michael Rellosa, the executive director of the Philippine Insurers and Reinsurers Association (PIRA), deems these figures unacceptable. "We have to make our roads safer," he asserts, emphasizing the need to educate Filipinos about how insurance works. "It is truly regrettable that people only think of insurance when they already figure in a road crash. We have to make Filipinos insurance-conscious and make insurance work for them." Drawing inspiration from successful models in other countries, particularly the United States, where the Insurance Institute for Highway Safety leads research on car safety and driver education, the Philippine insurance industry is poised to play a pivotal role in enhancing road safety. The manifestation of these efforts is the launch this week of a comprehensive road safety campaign in Makati, bearing the theme "Making Roads Safe is Everybody's Business." This initiative symbolizes a united front, bringing together insurance companies, road safety advocates, engineering experts, and law enforcement agencies—all committed to addressing the critical issue of road safety. TRAFFIC SIGNS A key partnership in this endeavor is with the Land Transportation Office, which is currently implementing a five-year Philippine Road Safety Action Plan (PRSAP) focused on prevention and education. The PRSAP 2023-2028 is a robust plan serving as a roadmap for road safety in the country. With a target of achieving at least a 35 percent reduction in road traffic deaths by 2028, it encompasses five pillars: road safety management, safer roads, safer vehicles, safer road users, and post-crash response. The insurance industry aims to play a pivotal role across all these pillars, with a particular emphasis on prevention. The industry is also forging alliances with research institutions to bolster its efforts. One such collaboration is with the National Center for Transportation Studies of the University of the Philippines. This partnership facilitates research and data processing using information available to insurance companies. Rellosa points out that insurance companies in the Philippines already possess a wealth of historical data on vehicular crashes, as they are the entities that handle claims when these tragedies occur. However, for far too long, this valuable data has remained underutilized. "Yet for the longest time, these data simply lie idle in the computers of insurers, as if waiting for the opportune time to tell the big story behind these tragedies," he explains. CAR CRASH This initiative is not just about preventing accidents but also about understanding the root causes of crashes. The insurance industry is collaborating with the Automobile Association Philippines, representing car owners, and the Motorcycle Philippines Federation, advocating for motorcycle riders. These partnerships acknowledge the significant role private vehicles play in road crash statistics. "Private vehicles comprise the majority of vehicles on the road and account for a big chunk of road crash statistics," Rellosa notes. "It is only fitting that we focus on them to understand the reasons why they figure in road crashes. It is by understanding that we can come up with data-driven interventions and programs." The emphasis on understanding and preventing accidents is a paradigm shift for the insurance industry. Traditionally viewed as a sector that comes into play after an incident has occurred, insurers are now actively engaging in proactive measures. The overarching theme is clear—to prevent accidents before they happen and to make roads safer for everyone. Rellosa encapsulates the vision succinctly: "We want to prevent the crash from happening in the first place. And we want to do this by understanding the risk profiles of our clients and educating them based on it." This proactive stance, coupled with partnerships across sectors, positions the insurance industry not just as a financial safeguard post-accident but as a proactive force for change. Source: mb.com.ph

Thank you so much for your support of the Digital Pilipinas in 2023, especially of the Digital Pilipinas Festival — with over 230 speakers from all over the world and 11 inaugural focus festivals, this is truly the Festival of all Festivals for everything digital. We couldn’t have done it without you. The work continues -- and we remain steadfast in our commitment to building more digital Pilipinas for our future generations. Through our collaborations with both private and public sectors -- we have proven it can be done. We'd like to share with you initial numbers of the Digital Pilipinas Festival -- highlighting the accomplishments in terms of numbers and actual output to stakeholders towards achieving further our objectives. The 5-day festival has seen our biggest numbers to date: close to 2,500 in foot traffic throughout 2 days (per foot traffic data provided by SM Aura), spread across 11 festivals located in different areas in SMX, 237 speakers in 41 panels, and various programs and partnership agreements signed during the festival. All these help push forward the agenda of promoting technological innovation in the Philippines and its role in the ASEAN digital economy. Maraming, maraming salamat po! For more information, kindly visit: www.facebook.com/DigitalPilipinas2023

Cyber criminals, especially the organized gangs indulging in these activities, are revising the ways they blackmail their victims as the ransomware payments are tapering down according to a new report. The 25-page report Negotiating with LockBit: Uncovering the Evolution of Operations and Newly Established Rules by ransomware cyber crime researcher Anastasia Sentsova and published by cyber security firm Analyst1 in November 2023 said, “On 1 October 2023, one of the most sophisticated ransomware syndicates, LockBit 3.0, announced new rules of negotiations among the members of the group. These rules were aimed at securing larger ransom amounts and increasing the likelihood of payout.” LockBit is a ransomware gang that is responsible for the recent attacks on Boeing and Industrial Commercial Bank of China among others. The gang has revised the way it tries to blackmail victims because of lower-than-expected ransom payments according to the report. The Russia-linked group has claimed some of this year’s biggest cyber attacks, however, the syndicate’s financial haul has paled in comparison to some rival gangs according to Ms. Sentsova. She said the group’s problem is that the group, now has more than 100 affiliates, many of whom are young and inexperienced in negotiations and this “has led to inconsistent and often low ransom amounts that decreased overall revenue and set an unfavourable tone for future negotiations.” LockBit recruits hackers to conduct the ransomware attacks using its tools and infrastructure and gets a cut of any ransom extorted in the attacks. A recent meeting between the gang’s main leaders culminated in new rules that went into effect from October 2023 laying out new tactics for hackers to follow when negotiating with the victims of their ransomware attacks. The guidance details exactly how much to ask for in payouts, even as “the final decision on a ransom payment amount is still at the affiliate’s discretion, depending on their assessment of the damage inflicted on the victim. The recommendations say that companies with revenue of as much as $100m pay 3% to 10% of their total sales, those with up to $1bn in revenue pay 0.5% to 5% and those with more than $1bn in sales pay 0.1% to 3%. Source: asiainsurancereview.com