As he prepared to sign a Statement of Intent (SOI) between the British Government, the Monetary Authority of Singapore and Lloyd’s in Singapore, UK Prime Minister David Cameron stressed that insurance is essential to “safeguard economic success.”
A bulletin from Lloyd’s explained that the “signatories have committed to a series of initiatives to aid the understanding of risk exposures in Asia and support and nurture insurance markets across the region.”
Lloyd’s also pointed out that “Asia is the world’s most natural catastrophe-prone region. However, on average, less than 5 percent of likely economic losses are insured when disaster strikes. This means that one major catastrophe could wipe out decades of economic progress.
“The three parties committed to working together to share knowledge and expertise with partners across the region. They hope this will help to identify threats facing regional economies and support the development of new risk transfer solutions. Other firms in the insurance industry across Asia are now invited to join the commitment and sign the SOI.”
Lloyd’s presence in Singapore dates to 2000 and considerable growth has been achieved since it established that presence. It now employs 400 staff and has achieved “premium growth of 120 percent over the last five years.”
Lloyd’s specializes in complex risks and reinsurance. It is therefore “able to share expertise, analysis and risk transfer solutions for catastrophe threats across Asia Pacific. London is the largest commercial insurance market in the world, controlling over £60 billion [$93.6 billion] of annual premiums; employing 48,000 people and contributing c. £30 billion [$46.8 billion] to UK GDP. Meanwhile, Singapore’s insurance market has seen premiums quadruple since 2000 and is now Asia’s preeminent insurance hub,” the bulletin explained.
The signatories made the following statements concerning the Statement of Intent:
UK Prime Minister, Rt. Hon David Cameron MP, said:
“As a world leading insurance provider, Lloyd’s plays an important role in protecting millions of people in the region from the financial losses of natural disasters. The agreement with Singapore will put Lloyd’s at the forefront of the Asian insurance market and shows how governments can work together with industry to provide a vital product. Lloyd’s ensures countries across Asia are protected which helps to safeguard their economic success.”
John Nelson, Chairman of Lloyd’s said:
“There is no doubting the value of open insurance and reinsurance markets. They diversify risk globally, underpin all aspects of economic growth and ensure that countries hit by catastrophes can rapidly recover. Lloyd’s has developed our largest concentration of underwriting and risk management expertise outside of London here in Singapore and we want to use that to support the development of insurance markets across Asia.”
Ravi Menon, Managing Director of the Monetary Authority of Singapore, said:
“Asia is especially vulnerable to the threat of natural disasters. The human and economic costs of these disasters are large and increasing while the proportion of these risks that is insured is worryingly small. The Monetary Authority of Singapore is committed to partner insurers operating in Asia to better understand these risks, develop effective insurance solutions, and facilitate cross-border access to specialist insurance services, so as to strengthen Asia’s resilience to large natural catastrophes.”
Source: Lloyd’s of London
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