Insurance Market In Singapore - Singapore Insurance Snapshots

Insurance Market In Singapore

In many ways Singapore is similar to Hong Kong in the life insurance market. It too hosts a significant regional financial center and growth in its domestic market is driven by an expansion of wealth management and bancassurance.

The differences lie in the extent to which the government views Singapore insurance as an important national industry and actively supports it, compared to the more laissez-faire stance taken by Hong Kong regulators. For example, the insurance cooperative NTUC Income has strong ties with the government. In the 1980s, the government tried to adopt a closed-door policy in order to prevent "unhealthy" competition, favoring local players over foreign ones. However, the plan backfired; the policy only reduced the competitiveness of the market and benefitted the foreign insurers who were grandfathered in and able to leverage their know-how from other markets to beat the local players. Meanwhile, industry growth was stunted, as there was little motivation for players to develop new products and channels. Foreign-owned insurers ended up holding more than half the market share in both the life and general insurance business.