Despite the ongoing COVID-19 pandemic, this year has seen several positive developments in the Bangladesh life insurance market.
For example, authorities in Bangladesh are currently considering a proposal to permit bancassurance based on an “open architecture” model where banks would have to distribute the products of more than one life insurer. This could go into effect some time in 2021. There is also growing interest in the Bangladesh life insurance market from multinational insurance companies.
To read more about recent developments in the life insurance market in Bangladesh, read this Milliman Asia e-Alert.
COVID-19 and the impact on capital markets pose several challenges for Indian life insurers. Against the backdrop of an already sluggish economy, the onset of COVID-19 has seen the Government of India and the Reserve Bank of India taking further steps to stimulate the economy by announcing a financial package for the poor and vulnerable sections of society and by cutting the reverse repo rate to 4.15% from 4.90% at the start of 2020.
In addition, the complete
lockdown imposed across India due to COVID-19 has clearly had an adverse impact
on new business volumes, especially in March 2020, when insurers typically
write the highest monthly volumes as consumers reach the taxation year-end.
In this Asia e-Alert, Milliman consultants discuss the impact of COVID-19 on capital markets and the challenges it poses for Indian life insurers.
This report by Milliman consultants covers the capital regimes in 10 markets in Asia plus the 2018 International Capital Standard field test. The report seeks to provide a comparison of key quantitative and qualitative aspects of life insurance capital regimes in Asia and an analysis of key capital results based on information publicly available and other market sources.
In October, the Insurance Regulatory and Development Authority of India released draft non-linked and linked insurance products regulations for comments. In this Asia e-Alert, Milliman consultants highlight the key changes proposed in the draft regulations as well as the business implications for life insurers.
Milliman has released its latest report entitled ‘Regulatory diversity across Asia.’ The report is a compilation and insightful analysis of current regulations applicable to life insurers across 14 Asian markets. It provides an analysis of the life insurance regulations in Brunei, China, Hong Kong, India, Indonesia, Japan, Malaysia, the Philippines, Singapore, South Korea, Sri Lanka, Taiwan, Thailand and Vietnam.
The report includes an overview of the main regulations in these 14 markets, governing the following areas:
• Products and pricing
• Capital and solvency requirements
• Policyholder protection
• Enterprise risk management (ERM)
Understanding the different stages of evolution of the regulatory regime across Asia will help life insurers, and other organisations with an interest in the life insurance industry, get a better perspective and help them in strategic business planning, market entry, mergers and acquisitions (M&A) and cross-border activities in these markets.
A few observations from the report:
• The markets in Asia are still very much ‘rules-based’ (as opposed to ‘principle-based’). Detailed rules and regulations govern different aspects of the industry.
• Regulators are increasingly looking at areas such as customer protection and meeting policyholders’ reasonable expectations (PREs), although these areas are still at a nascent stage in many of the markets.
• There is also an increasing focus on strengthening the governance environment through the Appointed Actuary/Chief Actuary systems and the role of board committees.
• There is a clear trend towards adoption of risk-based capital (RBC) regimes and the enhancement of such frameworks, wherever already adopted.
• The regulations in several markets are changing rapidly.
To read the report, click here.
Milliman has released the findings of a study analysing and comparing participating (par) business across seven Asian insurance markets, notably Singapore, India, Malaysia, Hong Kong, China, Indonesia and Sri Lanka. The report collates in-depth information not otherwise available and provides insight from survey results about par business in Asia.
‘Par products have been a core insurance offering for many decades in many markets across Asia Pacific and in Singapore, Hong Kong and India they remain a cornerstone of the industry,’ said Richard Holloway, managing director for Milliman’s South East Asia and India life consulting practice. ‘However, increased regulatory scrutiny of par business in countries such as Malaysia and the onset of risk based capital solvency regimes in most markets may lead to a gradual decline in the popularity of such products. This report unlocks key considerations for companies offering par products across the region, highlighting differences in performance, investment approach, and governance of par across the seven markets.’
The ‘Milliman Participating Business in Asia’ report includes:
• A regional view of common themes and differences among the seven selected markets
• Detailed country commentary on par business performance, regulatory environments and key challenges
• Results of our survey providing qualitative insights into par business in these countries
• Analysis of the governance frameworks in place and roles of policyholder advocates
To download the report, click here.