PineBridge Investments: Allocating OverseasJuly 31 2017
Many insurers in Asia are thinking of expanding their portfolios overseas. They may benefit from a closer look at the composition of overseas portfolios of insurers in more mature markets, as well as from an examination of key considerations in pursuing this approach
Amid the prolonged low-interest-rate environment, insurance companies in Asia, some with historically small overseas investment allocations, are now actively seeking both yield enhancement and diversification through
their overseas investment portfolios.
In mature markets such as the US, insurance companies have a long history of overseas investing, and the allocation percentage has been very stable. In other markets, such as China, the proportion of offshore investments has traditionally been low. Increasingly over the past two years, we have been witnessing a rapid change in offshore allocations, with some markets in the region moving aggressively in this direction.
However, when considering either moving into or expanding overseas allocations, insurers should not only consider the available instruments, yield differential, investment margin, and regulation/solvency, but they should also be aware of the additional risks involved.
- August 20
The move comes as the broking group's MGA division acquires AIG's HNW home and contents portfolio.
- July 2
The Asia chief executive discusses Covid-19, going digital and restructuring.
- April 10
Climate change, increased urbanisation and a growing concentration of assets were on the risk agenda for 2018.
- March 19
Economic uncertainty, more complex risks and tighter underwriting are all influencing Asia's markets.
The consultant is exploring potential acquisitions in Australia and New Zealand, and expanding its footprint in South-East Asia, Korea and Japan.
Managing these daunting risks will require a multi-stakeholder approach to risk identification, financing and mitigation.
Electric ferries are increasing in popularity but there is plenty of work ahead to move away from ships using heavy diesel oil.