Life insurance industry in Asia-Pacific receives improved outlook

Thursday, June 3, 2010

Standard and Poor have announced that they have managed to improve its outlook for the Asia-Pacific life insurance industry from negative to stable.

The company’s Ratings Services has anticipated that the Asia-Pacific market will remain vulnerable to the on-going global economic difficulties, but expects the strong domestic demand for insurance contracts and the strengthened capitalisation of companies to fuel strong performance among life insurance companies in the Asia-Pacific region.

However, it is not all good news as Standard and Poor continue to predict a far less positive future for life insurance providers in other regions, with the European and US life insurance markets still subjected to negative ratings.

Within the Asia-Pacific region, a stable outlook was given for Australia, , Hong Kong, Singapore, Korea, Malaysia, Taiwan, India , China, New Zealand and Thailand, but the outlook was held at negative for Japan.

An analyst at Standard and Poor commented:

“The improved credit conditions and economic circumstances in the Asia-Pacific region had improved the view of life insurers’ credit profiles, prompting expectations that life insurers in these regions would enjoy a solid financial performance in 2010 and 2011, as life insurance products continue to grow in popularity in the region, whether obtained directly from insurers or from building societies or banks.”