Welcome to Full Capacity, a weekly briefing on all the most important developments of the past week with a personal take on the news from our editor-in-chief, Mithun Varkey, delivered to your inbox every Saturday.
India (re)entry. Allianz has finally confirmed its JV with India’s Jio Financial Services, after an acrimonious end to its long-standing JV with Bajaj Finserv.
The German giant is targeting an H1 2026 launch for a reinsurance business in the country, as InsuranceAsia News reported this week.
Allianz Commercial’s existing India reinsurance business (operating as AGCS foreign reinsurance branch) will be transferred to the JV as a commercial fac desk, while the treaty operations will be managed by Allianz Reinsurance.
Asia foray. Speciality (re)insurance broker Consilium has expanded into Asia by opening a Singapore office and appointing Descartes’ Rob Drysdale as CEO of Consilium Cedent Fac Asia to lead its development.
Filling a vacuum. India has finally found a chairman for its insurance regulator, the Insurance Regulatory and Development Authority of India. The country’s former finance secretary, Ajay Seth, will take charge at the regulator.
The all-important regulatory post has been vacant for over four months, after the tenure of the previous chairman, Debasish Panda, ended in March.
The indecision around the top job had soured India’s ambitious plans for the insurance sector at a seminal period of transformation.
More capacity. Lloyds’ syndicates Antares, Munich Re Specialty – Global Markets, Newline and Tokio Marine Kiln have joined forces to launch a new cyber capacity pooling arrangement in Asia.
Nat cat brief. Typhoon Wipha caused widespread destruction across parts of southern China, including major flight disruptions in Hong Kong, Shenzhen, Zhuhai, and Macau.
Hong Kong, which issued its highest warning for the first time since Typhoon Saola in 2023, may have suffered financial losses of up to US$255 million. While it was feared the typhoon will gain momentum as it tracked towards northern Vietnam, it weakened t a tropical storm as it made a landfall.
Building resilience. This week, we dug deep into the region’s construction insurance sector. Rising material costs, labour shortages, and nat cats are reshaping the construction sector in Asia Pacific, leading to increasing exposures and underinsurance.
The story lays out the pricing trends across products, emerging themes in coverage and products as well as the opportunities in the sector.
Riding the cycle
Are the rating trends in the Asia Pacific region a cause for concern?
According to Marsh’s half-yearly global insurance market index, we are witnessing a sixth consecutive quarter of decline.
The Pacific region has experienced the most dramatic drop, with rates falling 11% – the highest decline seen globally. Asia saw a 5% reduction in the latest quarter, while the global average stands at 4%, marking the fourth straight quarter of decline.
What’s particularly striking is the accelerating pace of this trend. The Pacific had reported an 8% reduction over the previous two quarters, but in the latest quarter, it breached the double-digit threshold. Asia, on the other hand, had a more modest 3% decline in that period.
This downturn has affected all product lines worldwide, with the exception of the US, where rates have remained flat.
While many underwriters insist that rates remain adequate despite the softening, it may be time to reflect on the sustainability of this trend.
Some insurers are exploring innovative ways to differentiate their offerings beyond just rates.
Others are focusing on client retention through long-term agreements that often include discounts and low-claims bonuses.
A regional CEO I recently spoke with emphasised that shifting market conditions warrant a re-evaluation of their strategy, suggesting it may be wise to pause and take stock of the situation.
The robust growth many players enjoyed over the past few years has attracted excess capacity to the region, while inflating performance expectations.
John Donnelly, president of global placement at Marsh, noted, “With both new and established insurers vigorously competing for business, we expect overall trends to continue throughout 2025, barring unforeseen changes in conditions.”
A silver lining in this landscape is that rate reductions in financial and professional lines appear to be moderating.
Insurers may have reached a bottom in pricing, particularly in areas like D&O liability. However, the prolonged softening in these lines hasn’t been sustainable.
Marsh’s report warns that pricing trends can be significantly impacted by major catastrophes. Each year, the North American tropical storm and hurricane season looms as a critical factor.
As my colleague recently pointed out in a piece, those who wrote eulogies for the market cycle – the reports are greatly exaggerated!
People moves
This week’s most notable appointments include a new CEO at Indian general insurance startup Kiwi. Saurav Jaiswal has been appointed co-founder, managing director, and CEO (designate).
Starr Insurance has appointed David Wang to lead its financial lines business in Asia Pacific.
Specialist MGA Delta Insurance Australia has appointed BHSI’s David Augustyniak as its new cyber and professional indemnity (PI) underwriting manager in Australia.
To keep up with the latest appointments across the region, don’t miss our weekly people move roundup.
