Country Profile Singapore - www.lloyds.com/SingaporeMI July 2014
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Country Profile Singapore www.lloyds.com/SingaporeMI July 2014 tom.grace@lloyds.com
KEY FACTS
FULL NAME / CAPITAL CITY: Republic of Singapore / Singapore GDP (PPP): US$ 341bn (Global Rank #41)
LANGUAGE: Mandarin (35%), English (23%), Malay (14%), POPULATION: 5m (Global Rank #103)
Hokkien (11%), Cantonese (6%), Teochew (5%),
Tamil (3%) IMF CATEGORISATION: “Developed”
MAIN EXPORT PARTNERS: Malaysia 12%, Hong Kong 11%, China 10% (2011)
MAIN IMPORT PARTNERS: Malaysia 11%, US 11%, China 10% (2011)
MAIN EXPORTS: Machinery and equipment, pharmaceuticals, refined
petroleum products
MAIN IMPORTS: Machinery and equipment, mineral fuels, chemicals
2012 Rank 2013 Rank Change in Rank
EASE OF DOING BUSINESS: 1 1 0
COMPETITIVENESS: 2 2 0
FREEDOM FROM CORRUPTION: 1 5 -4
DISASTER YEAR ECONOMIC COST (US$ x 1000)
Epidemic 2000 0
Epidemic 2003 0
Epidemic 1999 0
Source: Disaster Statistics based on: Prevention Web (2013); Export Statistics based on CIA World Factbook; Doing Business Indicators based on World Bank & World Economic Forum
© Lloyd’s 2
KEY STATISTICS
GOVERNANCE INDICATORS SIZE OF ECONOMY WEALTH PER CAPITA
Percentile Rank (1-100) 2012 Purchasing Power Parity (PPP) basis Purchasing Power Parity (PPP) basis
SG HK MY in International $ bn in International $
77,633
800 100,000
Singapore Hong Kong Malaysia
2012
60,799
80,000
Government Effectiveness 100 97 80 600
49,236
449
Political Stability and Absence of 60,000
97 80 45
323
Violence/Terrorism 400
217
Control of Corruption 97 93 66 40,000
200
Regulatory Quality 100 100 70 20,000
Rule of Law 96 91 66 0 0
2006 2012 2018f 2006 2012 2018f
Voice and Accountability 54 67 38
SG HK MY SG HK MY
TOTAL NON-LIFE DIRECT INSURANCE MARKET NON-LIFE DIRECT INSURANCE MARKET* LLOYD’S GROSS SIGNED PREMIUMS
Premiums in US$ m Premiums in US$ m; by OECD Class Gross Signed Premiums in US$ m; by country of origin
6,000 350
295
293
291
Motor
5,000 593 300
PA & Health 250
2,987
973
2,902
4,000
2,726
Singapore 200
3,000 Property
304 2013 150
2,000 Liability US$ 3.0bn
100
1,000
MAT 299
50
0 485
2011 2012 2013 332 0
Miscellaneous 2011 2012 2013
SG HK MY
*Premiums refer to Singapore Insurance Fund only (Onshore) SG HK MY
All data, sources & data limitations are available for download at www.lloyds.com/comparecountries
LLOYD’S TRADING POSITION Insurance: Yes (except for compulsory classes of insurance and life)
Singapore Reinsurance: Yes (except for life)
www.lloyds.com/crystal Coverholders: No syndicate service companies only
© Lloyd’s 3BUSINESS ENVIRONMENT
Despite public discontent with the government over key policies, political stability in Singapore is assured in the five-year outlook. The People's Action Party
(PAP) has been in power since Singapore's independence in 1965, but over the past decade, its popularity has declined over public dissatisfaction with government
policies, particular over population size. However, the PAP still has a very large parliamentary majority, meaning its dominance in politics and thus political stability in
Singapore is not at risk for the next five years, if not 10.
The current external environment will be a challenge for export-reliant Singapore. Owing to Singapore's heavy reliance on trade for economic growth,
developments in external demand are critical to the country's growth outlook. The current outlook for progressive improvements in the global economy over 2014
indicate that Singapore's economy will continue to face headwinds The flash estimate for GDP growth in the fourth quarter of 2013 pointed to weaker-than-expected
growth with weakness particularly prevalent in the manufacturing and construction sectors. Recent manufacturing and trade data also point to a weak finish to 2013
which implies weak momentum for early 2014. As such IHS now calls for real GDP growth of 3.4% for 2014.
Singapore has always welcomed foreign investment, and has laws and policies designed to attract and maintain such investment. FDI provides capital, jobs,
and technical know-how to sustain economic growth, making up for Singapore's lack of natural resources. To this end, laws and policies are designed to facilitate
foreign investment wherever possible. Political stability also allows the government to plan for the long term, in consultation with the private sector where necessary.
The government's policy of actively managing labour relations also means that industrial unrest is rare.
Steady macroeconomic policy making is expected to continue to support growth. IHS expects the government to continue its prudent course of fiscal
conservatism and flexibility with the February release of the 2014 budget. Early indications are that the budget will continue to focus on productivity enhancing
measures, and measures to address social and demographic issues. The Monetary Authority of Singapore (MAS) is expected to maintain its tight monetary policy
stance which includes a moderate and gradual appreciation of the Singaporean dollar's nominal effective exchange-rate (NEER) policy band.
GROSS DOMESTIC PRODUCT (GDP) TOP-10 SECTORS (BY VALUE ADDED) BUSINESS ENVIRONMENT INFORMATION
(nominal GDP levels in US$ bn; Real GDP change) (value added in US$ bn & 2014 Change in real %) (provided by IHS Global Insight, April 2014)
500 16%
2013 2014
14.8% TOP SECTORS Value Percentage
14%
Added Change
400
12% 1. Wholesale trade 22.7 2.8
2. Retail trade - total 21.3 -0.1
10%
300 3. Banking & related financial 17.6 6.4
8% 4. Public admin. & defense 14.6 4.3
200 5. Health and social services 11.7 3.4
6%
5.2% 6. Business services 11.5 3.4
4.3% 4.4% 4.3%
3.7% 3.4%
3.9% 4% 7. Construction 11.2 5.2
100
8. Real estate 11.1 0.8
2%
1.3% 9. Land transport 11.0 1.9
0 0% 10. Education 8.8 3.4
2010 2011 2012 2013 2014 2015 2016 2017 2018 For daily updates visit: > www.ihsglobalinsight.com
Top-10 Total 141.5
© Lloyd’s 4INSURANCE ENVIRONMENT
2013 MAJOR SIF INSURERS 2013 DIRECT PREMIUMS QUICK LINKS / USEFUL SOURCES
(GWP in US$ m) (Premiums in US$ m; by OECD Class)
Insurance Market Profiles
371
AIG ASIA > www.iii.org/international/profiles
Motor
AXA SINGAPORE 340
593 The Singapore Insurance Association
MSIG 262 PA & Health > www.gia.org.sg
973
NTUC INCOME 240 The Insurance Regulator
Property Singapore
> www.mas.gov.sg
FIRST CAPITAL 233 304 2013
QBE 122 Liability US$ 3.0bn Lloyd’s Agency Network
> www.lloyds.com/agency
LIBERTY 134
MAT 299
Lloyd’s Claims Team
TOKIO MARINE 114 485
332
> www.lloyds.com/claims
ACE INS 93 Miscellaneous
OAC 81
* Premiums refer to Singapore Insurance Fund only
(Onshore) BUSINESS CULTURE GUIDE
> http://www.kwintessential.co.uk
Source: Regulator: www.mas.gov.sg; * per Audited Returns (2013) Source: Regulator: > www.mas.gov.sg (View Resources > Culture Guide)
A SMALL DIRECT INSURANCE MARKET WITH AN INCREASING IMPORTANCE FOR REINSURANCE FOR THE REGION: Estimates for the Singapore non-life direct
market stood at US$ 3.0bn for 2013. Singapore is the principal reinsurance market of the Association of South-East Asian Nations (ASEAN) countries and an increasing
proportion of the business which used to be placed in international markets is now shown to reinsurers based in Singapore.
GROWING PRESENCE OF INTERNATIONAL INSURERS AND REINSURERS: In 2010, the Singapore non-life insurance market was comprised of 45 general direct
insurers (including 10 general insurers with defined business lines), five composite insurers, 15 registered professional non-life reinsurers and eight composite reinsurers, 64
captive insurers, four representative offices of insurers and reinsurers, and 18 Lloyd's syndicates.
BROKER MARKET: Brokers and agents continue to be the main channels of distribution although companies are employing more diverse means of delivery such as direct
marketing, internet and bancassurance.
OUTLOOK: The Singapore insurance market is considered to be a well regulated insurance and reinsurance market for the region. However, market conditions are believed
to be under pressure with high levels of competition and overcapacity in some lines. A large number of companies compete for a finite amount of local business and rates in
most classes have fallen steadily in the past few years. The regulator, the Monetary Authority of Singapore, continues to refine its hands-off approach to market supervision,
relying increasingly on self-regulation through the General Insurance Association (GIA) and by means of legislative instruments such as risk-based capital and corporate
governance. The MAS has stated its intention of continuing to promote Singapore as the main insurance centre in Asia by encouraging investment in insurers and captives,
particularly those writing foreign business.
© Lloyd’s 5LLOYD’S BUSINESS
2009-2013 LLOYD’S TOTAL PREMIUMS 2013 LLOYD’S HIGH LEVEL CLASSES
Gross Signed Premiums; Direct versus Reinsurance; in US$ m Gross Signed Premiums; high level classes; in US$ m
350 2013 GROSS SIGNED PREMIUMS*
UK Motor 0.0
300 Overseas Motor
Total US$ 295m 0.0
250 Property Treaty 19.8
145
136 Reinsurance US$ 136m
157 Property (D&F) 49.5
200 Direct US$ 159m
101 111 Marine 113.0
150
*COUNTRY OF ORIGIN PREMIUMS Energy 34.1
100 Policyholders are based or
159 Casualty 37.3
136 146 headquartered in this territory;
50 116 119
Casualty Treaty 0.5
Premiums may be written outside
0 this territory; Aviation 11.2
2009 2010 2011 2012 2013
X Not necessarily where risks are located Accident & Health 29.7
Direct Reinsurance X May differ to what is reported to
local regulator (dependent on local requirements). 0 20 40 60 80 100 120
Source: Market Intelligence based on *Gross Signed premiums; Xchanging (2014); unaudited figures based on country of origin and processing by calendar year; see Appendix for details
Lloyd's Trading Centres provide bespoke services to Mr Kent Chaplin
Office support the underwriting of business in the region, Lloyd’s Asia
8 Marina View
Type including Lloyd's branded office space, a single Lloyd's Lloyd’s #14-01 Asia Square Tower 1
entity and back office services. Country Singapore 018960
Manager
TELEPHONE: +65 6499 9333
Service Amlin, Argo, Argenta, Ascot, Atrium, Beazley, Canopius, Capita, Catlin, Chaucer,
companies CV Starr, Hardy, Kiln, Markel, Newline, QMES, Talbot, Watkins. EMAIL: kent.chaplin@lloyds.com
© Lloyd’s 6LLOYD’S BUSINESS
2013 LLOYD’S ONSHORE & OFFSHORE PREMIUMS 2013 LLOYD’S OIF PREMIUMS
Premiums in US$ m
700
Insurance 591
10% There are two elements of the Singapore 600
Reinsurance 537 522
market: the SIF & OIF
500
Singapore Insurance Fund (SIF) 394
This is Singapore onshore domestic business 400
444
Lloyd’s 408 373
2013 300 268
US$ 590m* 282
Offshore Insurance Fund (OIF) 200
This is offshore regional business underwritten 176
from Singapore
100 149 147
112 129
90% 93
*Calculated from SGD using 2013 annual 0
average exchange rate 0.7992 2009 2010 2011 2012 2013
2013 MAJOR OFFSHORE INSURERS (OIF)* 2013 OIF CLASS OF BUSINESS (INCLUDING DIRECT &
Premiums in US$ m REINSURANCE)
ASIA CAPITAL RE 556
LLOYD’S ASIA 530 6% Casualty & Others
18%
ALLIANZ SE 502 12%
SWISS RE 373
Property
IAG RE 323
EVEREST RE 275
ODYSSEY RE 193
Hull & Liability
FIRST CAPITAL 168
PARTNER RE SE 153
Cargo
MUNICH RE 137 64%
Source: Regulator: > www.mas.gov.sg; * as per Audited Returns (2013); please see Appendix for exchange rates
© Lloyd’s 7LLOYD’S OBJECTIVES
To be the market of choice for specialist insurance and reinsurance in Asia Pacific and regarded as a profitable centre of underwriting excellence.
LLOYD’S KEY INITIATIVES 2014
Lloyd’s Asia Operating Model: Mandate co-location at Asia Square and encourage new entrants to the platform.
Help the Lloyd’s Market Write More Business: To be achieved by promoting the subscription market, promoting the Asia Pacific Broker Programme and meeting key
capital targets. Also raise awareness of Lloyd’s in Asia with improved Market Intelligence and profitability information.
EVENTS & MARKET INTELLIGENCE
2014 INDUSTRY EVENTS 2014 LLOYD’S EVENTS MARKET INTELLIGENCE
Available Market Intelligence products for this territory include:
East Asian Insurance Congress (EAIC) in Taipei, Country Profile
2-5 November
Market Presentation
AIR Asia CEO Summit, 18-19 February
AIR Asia Brokers Summit, 26-27 February Class Review Lite (Coming soon)
www.lloyds.com/SingaporeMI
© Lloyd’s 8APPENDIX
MACRO-ECONOMIC & BUSINESS ENVIRONMENT DATA
Source: IMF (www.imf.org/external/data.htm), World Bank (http://data.worldbank.org/), IHS Global Insight.
Notes: GDP data on size and wealth of the economy is reported in Purchasing Power Parity (PPP) terms; this is the most accurate indicator of the true standard of living in
each country and therefore potential demand. To calculate this, GDP is converted from local currency to an international $ currency using PPP exchange rates rather than the
market exchange rate. The PPP local currency-to-international $ exchange rates are determined such that a standard basket of goods has the same price in international $
terms in each country. This adjusts for the differing costs of goods across countries, when converted at market exchange rates.
INSURANCE MARKET DATA
Source: Reported data derived by Lloyd’s Market Intelligence team; original source is regulatory bodies, associations, third party information providers.
Notes: Data is reported in US$. For more information, see www.lloyds.com/comparecountries.
Exchange Rates Note: Where required, data has been converted to US$ using annual average exchange rates as per www.oanda.com.
LLOYD’S PREMIUM DATA
Source: Reported data derived by Lloyd’s; original source is Xchanging (data therefore contains only premiums processed by Xchanging).
Notes: Data is reported is US$, on a calendar year basis and is signed gross premiums. This differs from the data published in the Lloyd’s Annual Report, which is also on a
calendar year basis, but is written gross premiums and sourced directly from Syndicates. Differences are therefore (1) timing inconsistencies between signed and written gross
premiums; (2) inconsistent use of exchange rates by Syndicates and Xchanging; & (3) incompleteness of Xchanging data set for certain classes of business (a substantial
amount of premium is not processed by Xchanging and missing from the REG 258 data set; this comprises, for example, UK Motor).
Exchange Rates Note: Data has been converted to US$ using monthly exchange rates provided by Xchanging.
Definitions:
Gross Signed Premiums: Original and additional inward premiums, plus any amount in respect of administration fees or policy expenses remitted with a premium but
before the deduction of outward reinsurance premiums.
Calendar Year: Relates to the calendar year in which the premium, additional or return, is processed by Xchanging. This is irrespective of the actual underwriting year of
account, which is determined by the inception date of each risk.
Country of Origin: Denotes the domicile of the insured party (i.e. the coverholder or policyholder). This is the country from which demand for the insurance / reinsurance
emanates, & is irrespective of the country to which the risk is classified for regulatory reporting purposes.
Example: A policy holder in the UK insuring a holiday home in France would be classified as a UK risk by “Country Of Origin”, but “French” for regulatory reporting
purposes. Similarly a risk incepting on 1st December 2007 would be classified at 2007 “Underwriting Year of Account” but may not be processed by Xchanging until 2008
and so be allocated to the 2008 “processing year”.
ACCESSING THE DATA: to access the raw data in this document, and equivalent data for other countries, see www.lloyds.com/comparecountries.
DISCLAIMER: This document is intended for general information purposes only. Whilst all care has been taken to ensure the accuracy of the information, Lloyd's does not
accept any responsibility for any errors or omissions. Lloyd's does not accept any responsibility or liability for any loss to any person acting or refraining from action as a
result of, but not limited to, any statement, fact, figure, expression of opinion or belief contained in this document.
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