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Huge growth potential for Asian Reinsurance: Fitch

India Infoline News Service | Mumbai |

Fitch says many Asian markets have low insurance penetration, in particular the untapped Chinese and Indonesian markets.

Fitch Ratings says that the robust development of insurance in Asia, coupled with the region's low contribution to global reinsurance premiums written and strong economic growth, underlines huge growth potential for reinsurance.

Fitch says many Asian markets have low insurance penetration, in particular the untapped Chinese and Indonesian markets. Although Asia has been affected by an increase in the frequency and severity of natural catastrophes in recent years, there have been fewer events since 2011. Premium rates for regional reinsurance policies renewed during 2012-2013 have reached a plateau, except for some marginal rate increases for selected policies written on catastrophe-prone areas within Asia.

The report notes that demand for reinsurance is likely to benefit from an evolving regulatory environment as regulators strive to improve the overall financial health and risk management capabilities of insurers. Fitch believes that as direct insurers review their risk management strategies and appetites in line with tighter regulatory initiatives, insurers may transfer more risk to reinsurers.
 

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