In this interview with The Insurer, Tony Gallagher, CEO, Asia Pacific, indicates that climate change, capital management and the changing nature of risk will be dominant themes around (re)insurance in Asia. Tony indicates that catastrophe bonds and parametric solutions are becoming bigger factors in the region to respond to these challenges.
“With ever-changing reinsurer and insurer risk appetites and the dynamic risk landscape, we observe that the catastrophe bond market is gaining traction in the region,” Tony explains. “I think Asia will see more catastrophe bonds coming in, as there is increased awareness of the benefits of transferring catastrophe risk to capital markets.”
“Renewables, parametrics and cyber products are becoming increasingly relevant to the region, as growing risks from climate and cyber threats have created a demand for these specialized insurance products,” he continues. “In terms of countries, we are eyeing China and India, both of which we believe hold significant growth potential and new opportunities.”
Tony goes on to explain how there is still a lot to do to close the coverage gap in Asia Pacific, but he emphasizes there is no “one size fits all” solution.
“When you look at products such as parametric insurance and catastrophe bonds, these risk transfer solutions are indeed playing an integral part in building resilience to natural catastrophe,” he said. “Yet affordability and availability of capacity will be crucial in narrowing the gap, both regionally and globally.”