Reacting to risk in Lloyd's Asia hub
Thu 23 Feb 2012
Singapore is the leading Financial Services centre for the Asia Pacific market and over the last ten years it has been home to Lloyd’s Asia, which has generated growth of more than 420% in the last five years alone.
From just a handful of syndicates a decade ago, Lloyd’s Singapore office now services 22 syndicates and more than 250 staff.
With growth on that kind of scale, it’s little wonder that Lloyd’s had to move into more spacious offices in Singapore’s Marina Bay last year. This month, Lloyd’s Chief Executive, Dr Richard Ward, officially opened these new offices as part of a visit to further raise Lloyd’s profile with key industry participants.
In a packed week, Dr Ward met the Singaporean Minister of Transport to offer Lloyd’s support to his aim to enhance Singapore’s status as a maritime centre. Singapore is already the world’s fifth largest port, and Lloyd’s turns over a steady stream of maritime business – London is, after all, the world’s largest centre for maritime insurance.
The meeting also provided a welcome opportunity for Dr Ward to encourage the exchange of insurance professionals – and knowledge – between London and Singapore.
Asia Insurance Review
Giving the keynote speech at the Asia Insurance Review Summit, Dr Ward highlighted the fact that 2011 had been the second costliest year for the insurance industry on record, with claims of $107bn, largely attributable to natural disasters in the Asia-Pacific region.
“For the first time I can remember, this region has dominated catastrophe claims activity,” said Dr Ward at the summit. “It is a reminder that the insurance industry is a genuinely global industry. Asian growth has pushed up the value of assets and insurance take-up. If the region can take away one lesson from the tragic events of 2011, it is that insurance can help withstand disaster.”
Dr Ward continued: “We need to look at how we can allow more risk to be transferred. The challenge is how we balance the transfer of risk from governments and businesses through insurance in both the short- and the long-term.”
Disciplined underwriting "as important as ever"
Addressing the short-term challenges facing the industry, Dr Ward pointed to a year of economic uncertainty, coupled with the impact of low interest rates on investment income. Speaking shortly after Lloyd’s announced a $2.2bn claims bill for last year‘s floods in Thailand, he warned that 2012 remains a difficult year for the industry, making disciplined underwriting as important as ever.
Looking to the longer term, using findings from the Lloyd’s Risk Index, Dr Ward said that awareness of all types of risk was rising more quickly in Asia Pacific than in any other area of the world, offering new opportunities to the Lloyd’s market.
Lloyd’s wide industry knowledge was, he explained, a perfect complement to the local knowledge of regional market players. He added that Lloyd’s wants to build these relationships further, encouraging the flow of capital and practitioners between Asia and London, to help develop an insurance industry that is truly global.
Find out more about the new Singapore offices for Lloyd's Asia