About the Life Insurance Market in Southeast Asia
The 2007 financial crisis shattered many economies across the globe, and triggered a negative shift in customer demand, especially in the life insurance sector. The drop in income not only reduced demand for life insurance policies and products but also curtailed the market penetration of the industry. In the current market scenario, there are many product portfolios offered by the top life insurance vendors. With this scenario in place, the demand for life insurance policies is calculated on the basis of the rate at which transparent products are being provided by vendors to customers.
Technavio’s analysts forecast the life insurance market in Southeast Asia to grow at a CAGR of 7.71% during the period 2016-2020.
Covered in this report
The report covers the present scenario and the growth prospects of the life insurance market in Southeast Asia for 2016-2020. To calculate the market size, the report considers the gross life premium value in Singapore, Indonesia, Thailand, the Philippines, Malaysia, Vietnam, and other nations. The other regions include Cambodia, Brunei, Laos, Burma, and Timor-Leste.
The market is divided into the following segments based on country:
Technavio Announces the Publication of its Research Report – Life Insurance Market in Southeast Asia 2016-2020
Technavio recognizes the following companies as the key players in the life insurance market in Southeast Asia: AIA Group, Manulife, and Prudential Financial.
Other Prominent Vendors in the market are: Aviva, AXA, Great Eastern Life, HSBC, NTUC Income, and Tokyo Marine.
Commenting on the report, an analyst from Technavio’s team said: “A trend which is boosting market growth is the rise in the use of BPO for closed-book operations. In Southeast Asia, the life insurance vendors are looking for strategies that can help them reduce operational costs. One of the strategies that may gain momentum during the forecast period is the outsourcing of closed book operations to BPOs. Closed book operations help top life insurance vendors and pension providers to transfer products to a third-party provider for better operational efficiency. While a closed book operation does not generate any revenue, it can have claims and service expenses. Therefore, life insurance companies try to outsource closed book operations, and this creates an opportunity for tier 1 and tier 2 life insurers. Such a strategy also helps top vendors to avoid legacy systems, which are expensive and risky.”
According to the report, a key growth driver is the creation of favorable environments to improve profitability. Life insurance companies are enforcing professional and disciplined underwriting practices to ensure healthy growth in the emerging markets like Southeast Asia. Such initiatives are expected to ensure that companies operate on a sustainable basis. In addition, we expect the capital management of the life insurance market to support vendors' growth and tighten solvency capital requirements during the forecast period.
Further, the report states that one challenge that could hamper market growth is the lack of financial models. Currently, life insurance companies do not use any financial models. The lack of such a system has resulted in several challenges, including inadequate underwriting practices.
AIA Group, Manulife, Prudential Financial, Aviva, AXA, Great Eastern Life, HSBC, NTUC Income, Tokyo Marine.