GlobalData’s 2024 Global Reinsurance Market Report reveals that APAC accounted for 13.3% of global reinsurance premiums in 2023. The reinsurance market has witnessed stable pricing in 2024, marking a departure from the hard market conditions of 2023.
A few mature and fast-growing insurance markets in the APAC region will drive the growth along with an increasing inclination of reinsurers towards underwriting catastrophe risks. Regulatory developments, such as the introduction of the new risk-based capital regimes in Hong Kong (China SAR) and climate risk stress tests in Malaysia, are also enhancing the market's resilience.
Swarup Kumar Sahoo, Senior Insurance Analyst at GlobalData, comments: "The APAC reinsurance market is expected to register steady growth, supported by disciplined pricing strategies and selective risk management. The adoption of International Financial Reporting Standard 17 in countries like Japan and South Korea has led to stable returns on equity, further strengthening the market. However, the region's vulnerability to natural catastrophes and economic uncertainties poses challenges that reinsurers must navigate carefully."
The cyber-insurance market presents a compelling growth opportunity for APAC reinsurers, as the global cyber-insurance market premiums are estimated to increase by 8% to $16.6 billion in 2025, according to Swiss Re. Despite this growth, a substantial cyber protection gap persists, highlighting the potential for geographical expansion. The uneven distribution of cyber premiums, with APAC accounting for only 8%, indicates significant room for growth in this segment. Additionally, the demand for agricultural and natural catastrophe coverage in China is expected to rise as the primary insurance market develops.
Sahoo adds: “Reinsurers in the APAC region are increasingly utilizing advanced technologies to enhance their operational processes and risk evaluation methods. The integration of AI, the Internet of Things (IoT), and machine learning is enabling the creation of innovative products and improving risk assessments related to specific perils. This technological adoption is crucial for navigating the complexities associated with climate change and other emerging risks.”
The APAC reinsurance market is also witnessing a growing interest in Insurance-Linked Securities (ILS), with Hong Kong (China SAR) emerging as a central hub. This trend is expected to support market growth and stability, although the full potential of the ILS market depends on further advancements and increased participation from Asian investors.
Sahoo concludes: "Technological advancements and regulatory developments will play a pivotal role in driving the growth of the reinsurance market in the APAC region. The region's susceptibility to natural catastrophes and the increasing importance of cyber insurance will continue to shape the market's trajectory. As reinsurers embrace selective underwriting approaches and leverage advanced technologies, the APAC reinsurance market is well-positioned for sustained growth in the coming years."
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