APAC's regulatory sophistication in insurance sector bubbling

In response to global regulatory initiatives.

Regulatory sophistication within the insurance sector is on the rise across Asia-Pacific as the region responds to the reach and influence of global regulatory initiatives and now faces a second stage of opportunity and change.

According to a release from Standard & Poor's Ratings Services, in a new report that it has recently published entitled, "Amid Sweeping Changes To Insurance Regulation, Where Does Asia-Pacific Stand Within The Global Regulatory Landscape?", the firm claims that the mature markets in the region are responding to elevated expectations for risk management and group supervision.

Further, the markets are also responding to greater alignment with Insurance Core Principles for regulatory oversight as outlined by the International Association of Insurance Supervisors (IAIS).

"We see this advancement in regulatory oversight and improvement in risk management capability as positive to insurer credit profiles, but the gradual implementation and some negative outcomes limit any significant financial or rating impact on insurers", says credit analyst Natasha Hall, in the report.

"Asia-Pacific's insurance markets are at different stages of development, but Australia and Singapore lead the region in regulatory sophistication, and Japan is expected to move closer in coming years", says credit analyst Michael Vine.

"These leading markets compare favorably to advanced global markets, although Asia-Pacific more broadly lags behind Europe, the U.S., and Canada in regulatory oversight", he says.