Global Insurance Trends And Development: A Weekly Recap

Liga Asuransi – Dear Readers, how are you? I hope your business is always doing well.

Staying up to date with the latest trends and changes in the international insurance market is crucial for brokers, insurers, and insureds. 

Insurance is a rapidly evolving industry, and market conditions can significantly impact insurance policies’ pricing, coverage, and availability. Therefore, staying informed about the latest developments and changes is essential to make informed decisions.

For brokers, providing timely and accurate market updates to their clients is a critical part of their role. Brokers act as a liaison between the insurer and the insured, and their clients rely on their expertise to make informed decisions about their insurance policies. 

By keeping up with the latest market trends, brokers can provide valuable insights to their clients about the best policies to meet their needs and budget. Additionally, brokers can help their clients understand any changes in the market that may affect their existing policies, such as changes in coverage, pricing, or policy terms.

As a leading insurance media in Indonesia, starting from this edition, LIGAASURANSI.COM will present you with a weekly international insurance update. 

The primary source of this news is selected and summarized from https://www.insurancejournal.com/news/international/; therefore, if you need more detail, please visit the website.

Marsh’s latest report indicates that there has been a moderation in the rate hikes of cyber insurance while property prices have risen in most regions.

April 27, 2023

Global cyber insurance prices have moderated in Q1 2023, with an average price increase of 11% in the US and 10% in the UK, according to Marsh’s Global Insurance Market Index. This has been attributed to new market entrants increasing capacity and competition. 

Meanwhile, property insurance pricing has increased in most regions, with the US leading the way with a 17% increase in Q1, compared to an 11% rise in the prior quarter. Overall, global property insurance pricing was up 10% in Q1 2023, compared to a 7% increase in Q4 2022. 

The report notes that pricing increases across most regions moved within a small range compared to the previous quarter, as decreases in financial and professional lines and continued moderation in the cyber market were offset by increases in property rates.

Marsh’s report also highlights that global commercial (composite) insurance prices increased by 4% in Q1 2023, marking the 22nd consecutive quarter of increases. Insurers remain concerned about the impact of inflation on asset values and claims costs, with total insured values at renewal increasing by 9%, on average, during the first quarter in the US. 

Casualty pricing was up 3% on average, while financial and professional line pricing fell by 5% in Q1. All references to pricing and pricing movements in the report are averages unless otherwise noted. The report also notes that insurers are increasingly concerned about the impact of inflation on asset values and claims costs.

Ship Insurers Warn of Russian Oil Price Cap Evasion, Risks of Growing ‘Dark Fleet’

April 27, 2023

Ship insurers are becoming increasingly concerned about the possibility of violations of Western price caps on Russian crude oil and oil products as spot prices for Russian crude oil rise above the $60 per barrel cap. 

The Group of Seven Nations, the European Union, and Australia imposed price caps in December and February to curb Moscow’s oil revenues following the Ukraine war. However, shipping documentation can be filled with false information, making it difficult for ship owners to verify the actual price of the cargo. 

The price caps have been effective in depressing prices for Russian oil, but a jump in global Brent crude prices above $80 a barrel has pulled the Russian Urals above the $60 a barrel price cap, while ESPO Blend has also been trading above $60 a barrel.

The growing “shadow or dark fleet” further complicates the situation, which includes tankers purchased by states to deliver Russian oil, increasing safety risks for the shipping sector. As a result, more ships could risk losing insurance coverage because of sanctions, increasing risks for shippers and governments worldwide. 

Insurers are warning of the need for extra vigilance to avoid any sanctions violations, especially given the potential for false documentation and the challenges of verifying the actual price of the cargo. The price caps are based on the Brent benchmark, which only partially captures the value of Russian crude.

Ping An Insurance, China’s biggest insurer by market value reported a substantial increase in first-quarter net profit, with investment income driving the 48.9% rise.

April 26, 2023

China’s Ping An Insurance reported a 48.9% rise in first-quarter net profit to 38.4 billion yuan ($5.55 billion), thanks to increased investment income. 

The company’s gross written premiums rose 2.1% to 133.1 billion yuan, and its retail customer base increased 0.9% to 228.6 million.

Ping An is China’s largest insurer by market value and also the largest shareholder of HSBC. The two firms have been in a public battle since November 2021, when Ping An urged the bank to hive off its profitable Asia business to deliver better returns to shareholders. 

The spat has become more heated in recent weeks ahead of HSBC’s annual shareholder meeting on May 5.

Sompo Holdings Inc., Japan’s third-largest non-life insurer group, plans to concentrate on integrating its operations after a string of foreign acquisitions to fuel further growth.

Sompo Holdings Inc., Japan’s third-largest non-life insurer group, plans to focus on integrating its domestic and overseas operations to further its growth. 

The company has expanded its global presence through various acquisitions, including the $6.3 billion purchase of Endurance Specialty Holdings in 2017, which gave Sompo a much-needed foothold in the US market. 

In addition, the firm bought five more companies in the last five years, including US agriculture insurance company Diversified Crop Insurance Services in 2020. 

The company plans to deepen integration by globalizing capital allocations and product launches, analyzing risks on a global basis, and launching a predictive care data platform to improve care services’ productivity. 

Sompo forecasted an adjusted consolidated profit of 100 billion yen ($746 million) for the overseas insurance business in the year that ended in March, with an overall adjusted consolidated profit estimated at 160 billion yen.

Tokio Marine Weighs Sale of Southeast Asia Life Unit Valued at $1 Billion

Tokio Marine Holdings is reportedly considering selling its life insurance business in Southeast Asia, with a deal possibly valuing the units at around $1bn. 

The move is part of the Japanese insurer’s focus on its core operations. It is working with an adviser to test investor interest in its life insurance operations in Indonesia, Malaysia, Singapore, and Thailand. 

The insurer is said to prefer to sell all of the assets together, but it is also considering a piecemeal approach. The sources said a formal sale process could start in the coming months but that considerations were still early and that Tokio Marine may choose to retain the assets. Tokio Marine’s international business accounts for 54% of its profits.

• Marsh has launched a global facility backed by QBE covering all major business classes.

April 21, 2023

Insurance broker Marsh has launched “Fast Track,” an insurance facility that offers additional capacity to its clients across major lines of business. Fast Track will be backed by a panel of A-rated global insurers based at Lloyd’s, led by QBE. 

Under the terms of the facility, insurers will provide up to 10% of the capacity for policies written on a subscription basis and follow all terms set by the lead underwriter. 

Marsh’s clients globally can access the facility across all major business classes except motor. The launch of Fast Track comes as insurance prices continue to rise globally. Peter Burton, executive director of International Markets at QBE, said that QBE is delighted to lead this facility for Marsh and provide Marsh’s global client base with long-term consistency and stability of insurance capacity.

Markets/Coverages: Swiss Re and insurtech Benekiva partner to offer life and health (L&H) claims solutions.

April 28, 2023

Swiss Re Reinsurance Solutions has partnered with Benekiva to offer a digital end-to-end claims management solution that combines Benekiva’s claims administration system with Swiss Re’s Claims Automated Rules Engine and risk management expertise. 

The Integrated Claims Management Platform is an innovative end-to-end solution for digital claims management that includes digital claims intake, workflow, correspondence, document management, claims risk scoring, triaging, and built-in payout and audit capabilities. 

The partnership aims to improve the speed and consistency of claims decisions while providing a streamlined customer experience. The solution is designed to be flexible and scalable so insurers can choose the version that suits their needs.

L&G Insurance Broker, a leading insurance broker in Indonesia, presents this information.

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