In the insurance industry, it is common knowledge that The Association of Southeast Asian Nations (ASEAN) region presents enormous growth potential, fuelled by the key characteristics of low existing insurance penetration rates, rapidly growing wealth and an expanding middle class, and the exposure of the region to the threat of natural catastrophe.

In the coming years, the region will provide further opportunities for insurers, including in the form of the opening of new markets such as Myanmar, which has been largely closed to foreign participation. While the impact of the liberalisation of this market is not expected to be large in the short term, the fact that so many insurers and intermediaries have established a presence in the country reflects the fact that it presents a great opportunity for insurers to establish a foothold in one of the remaining untapped markets in the region.

Indonesia also is still regarded as a key piece in many global insurers' regional strategy and this has been reflected in a number of major acquisitions announced in recent months by insurers including Tokio Marine, Zurich and FWD.

However, gaining traction across the region requires a nuanced strategy that takes account of regulatory and market conditions. Restrictions on new licences and/or foreign ownership limits in certain countries have triggered the need for insurers to investigate a variety of structures and commercial arrangements designed to gain access to what has the potential to be a huge market.

The use of technology to connect the region is seen as paramount, and the recent signing of a new e-commerce agreement at the 17th ASEAN Economic Community (achieved after 9 rounds of negotiations which commenced in June 2017) is seen as further evidence of the region's commitment to digital solutions.

Many see the rise of developments in the fintech space as playing a central role in unlocking ASEAN's potential, not only in the deployment of new technologies and innovative solutions across the payments, insurance and financial services sectors, but in the development of a regional ecosystem that will provide for greater co-operation and collaboration across geographies and markets.

Governments such as Singapore's have invested heavily in the development of a fintech ecosystem, having made a strategic decision that fintech solutions will play a critical part in the future of the region.

To find out more about transparency developments and trends in ASEAN please see 'ASEAN Insights – a report for business on the regional policy and regulatory environment'.

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