Myanmar to allow five foreign players to operate life insurance business

Swiss insurtech firm Stonestep AG, that is aiming to expand across Asian countries in 2019, is preparing to offer more micro-insurance products in …
April 7, 2019

In a major reforms move, Myanmar has allowed five foreign companies to operate life insurance business in the frontier country, according to an announcement.

The Ministry of Planning and Finance (MoPF) of Myanmar has decided to award Preferred Applicants Foreign Life Insurance Licences to Japan’s Dai-ichi Life Insurance Company Limited, Manufacturers Life Insurance Company Canada, AIA Company Limited, Chubb Tempest Reinsurance Limited from Bermuda; and Prudential Hong Kong Limited, a member of the Prudential plc from the U.K.

AIA is a subsidiary of pan-Asian life insurance group AIA Group Limited. The foreign insurers will be operating in Myanmar as 100 per cent wholly-owned subsidiaries [of the parent companies] once they are granted the licence.

The companies will have to comply with pre-licensing conditions stipulated by MoPF before being granted the Preferred Applicants Foreign Life Insurance Licences.

The foreign companies will be competing with three local companies that focus on providing life insurance and nine local private insurers that are approved for composite insurance (both life and general).

Meanwhile, there is also the microinsurance service available in Myanmar. Swiss insurtech firm Stonestep AG, that is aiming to expand across Asian countries in 2019, is preparing to offer more micro-insurance products in Myanmar.

Nic Nicandrou, chief executive, Prudential Corporation Asia, said, in a statement, the continued expansion and liberalisation of Myanmar’s life insurance sector is expected to bring significant benefits to the country.

It could take about six months for the foreign insurers to prepare before getting the licences, said Thaung Han, secretary, Myanmar Insurance Association.

Han, who is also the managing director of CB Securities, is optimistic about more players joining the life insurance market. CB Securities, which offers life insurance, is planning to form a joint venture with Thai Life Insurance to boost business development.

Local firms like CB Securities currently offer public life insurance plan, government employees life insurance plan, athletes life insurance plan, among others.

Opening up the insurance sector has been initiated since 2013 when the government granted 11 licenses to local companies. In October 2017, the Myanmar Insurance Association was formed with state-owned Myanma Insurance and private companies as members.

The association, which is operating through six committees, is helping out local insurers with product development.only

Currently there are about 21 foreign insurance companies that are allowed to operate in the country by opening up representative offices, out of which three companies from Japan are allowed to operate only in the Thilawa Special Economic Zone.

According to a report published in 2017 by risk management firm Aon Inpoint, Myanmar’s insurance penetration is very low compared to other developing markets in Asia, with 0.01 per cent of GDP for life and 0.07 per cent of GDP for non-life in 2015. It also estimates that Myanmar’s non-life insurance market could potentially reach $0.14 billion over the next 15 years and the life market at $0.9 billion.

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HK awards first online-only insurance licence to Bowtie

The licence comes as Hong Kong is pushing a number of financial technology or fintech initiatives in an effort to compete better with rival centres, such …

Hong Kong has awarded Bowtie Life Insurance, a company backed by Sun Life Financial’s Hong Kong unit, the first online-only insurance licence under the city’s “fast-track” scheme.

The online platform will operate in a market worth more than US$63 billion (S$86 billion) in insurance premiums, and will compete with players such as AIA Group and the local unit of Prudential.

Bowtie Life Insurance, which is also supported by Sequoia Capital managing partner Neil Shen’s Hong Kong X Technology Fund, will offer life insurance directly to consumers rather than selling through intermediaries such as agents or banks, as is common in Hong Kong.

More than 80 per cent of customers are willing to use digital and remote contact channels including e-mail, mobile apps, video or phone instead of interacting with insurers via agents or brokers, a report by consultancy EY showed.

Hong Kong is home to a developed life insurance market, with a life and health insurance premium-to-gross domestic product ratio of 17.94 per cent last year, the second highest in Asia after Taiwan, according to insurer Swiss Re.

The licence comes as Hong Kong is pushing a number of financial technology or fintech initiatives in an effort to compete better with rival centres, such as Singapore and London, to reel in more investments.

Hong Kong’s Insurance Authority’s (IA) fast-track scheme was launched last year to speed up applications for insurers operating solely online.

  • $86b

    Worth of total premiums in Hong Kong’s insurance market.

“The IA is closely examining a few other applications under the fast-track and will issue new authorisations as and when ready,” the regulator’s chief executive Clement Cheung said in a statement.

The Hong Kong Monetary Authority, the territory’s de facto central bank and banking regulator, will issue the first licences to online-only banks in the first quarter of next year.

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Hong Kong gives first online-only insurance licence to Sun Life-backed firm

Bowtie Life Insurance, which is also supported by Sequoia Capital managing partner Neil Shen’s Hong Kong X Technology Fund, will offer life …

Hong Kong

HONG KONG has awarded Bowtie Life Insurance, a company backed by Sun Life Financial’s Hong Kong unit, the first online-only insurance licence under the city’s “fast-track” scheme.

The online platform will operate in a market worth more than US$63 billion in insurance premiums, and will compete with players such as AIA Group and the local unit of Prudential Plc

Bowtie Life Insurance, which is also supported by Sequoia Capital managing partner Neil Shen’s Hong Kong X Technology Fund, will offer life insurance directly to consumers rather than selling through intermediaries such as agents or banks, as is common in Hong Kong. More than 80 per cent of customers are willing to use digital and remote contact channels including email, mobile apps, video or phone instead of interacting with insurers via agents or brokers, a report by consultancy EY showed.

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Hong Kong is home to a developed life insurance market, with a life and health insurance premium to GDP ratio of 17.94 per cent in 2017, the second-highest in Asia after Taiwan, according to insurer Swiss Re.

The licence comes as Hong Kong is pushing a number of financial technology or “fintech” initiatives in an effort to compete better with rival centres such as Singapore and London to reel in more investments.

Hong Kong’s Insurance Authority’s (IA) “fast-track” scheme was launched last year to speed up applications for insurers operating solely online.

“The IA is closely examining a few other applications under the fast-track and will issue new authorsations as and when ready,” the regulator’s chief executive Clement Cheung said in a statement.

The Hong Kong Monetary Authority (HKMA), Hong Kong’s de facto central bank and banking regulator, will issue the first licences to online-only banks in the first quarter of next year. REUTERS

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