Standard Life Investments

Inside Global Insurance Investment

Asian Actuarial Conference

Standard Life Investments’ Insurance Solutions team was honoured to present at the 20th Asian Actuarial Conference in early November 2016.

March 2017

Standard Life Investments’ Insurance Solutions team was honoured to present at the 20th Asian Actuarial Conference in early November 2016. Please see the link below for full details of this notable event, including our own presentation.

http://www.actuariesindia.in/home.aspx

The 2016 annual pan-Asian actuarial conference was held in India for the first time. Previous host nations were Thailand, Taiwan, Singapore and Malaysia. In 2017, the conference will be held in Beijing, China. Approximately 700 delegates attended from 27 different countries. Around 400 of the attendees were from India, with significant representations from Japan, South Korea, Taiwan, China and Singapore, among other countries.

Indian insurance companies are not currently allowed to outsource assets to third-party managers. Should these rules ever change, this could generate very significant business opportunities for thirdparty asset managers.

Our presentation covered the journey taken by Standard Life as it transitioned its business model from UK mutual life insurer to global investment firm. We went on to discuss the low interest rate environment, global regulatory change, risk-controlled asset solutions and Solvency II annuity asset solutions. We also took the opportunity to mention our forthcoming Asian insurance survey. This will study the Chinese, Japanese, South Korean and Taiwanese insurance asset management markets and is a follow-up thought leadership piece to our recent European insurance survey. Look out for this being issued later in the year.

Although Indian bond yields are currently high in absolute terms, they have been in decline. It was evident that the more experienced actuaries present were beginning to consider the impact this might have on the Indian insurance market – in particular, on the sustainability of both new and legacy business investment guarantees.

There was sizeable representation from the Japanese insurance market. The Japanese presentations confirmed the material challenges presented by the country’s low interest rates, as well as its ageing and declining populations. Our own experience suggests Japanese insurers are increasingly switching out of Japanese government bonds to invest in other potentially higher-yielding asset classes like private market assets and multi asset, especially overseas. These views were confirmed and we believe this is an area of potential opportunity for third-party insurance asset managers who can add value for clients through these asset classes.