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The Actuary The magazine of the Institute & Faculty of Actuaries
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Opportunities in Asia

The insurance industry in Asia is facing challenges and opportunities on a variety of fronts. While countries such as China and India are opening up to foreign entrants, poor market conditions and politically unstable environments have led to the withdrawal of several insurers from countries such as Taiwan and Indonesia.
One of the major challenges facing life insurers is to develop products and distribution channels to meet the requirement of increasingly sophisticated consumers in the more developed markets. This has resulted in the growth of new product areas such as investment-linked, and the development of bancassurance as an important distribution channel. These factors have caused several companies to review their dependence on agency sales forces and to look at alternative methods of distribution.

Life actuaries
From the perspective of a life actuary interested in accelerating his or her career, Asia can be an excellent place to start. For example, for those who possess commercial and financial acumen in addition to technical skills, it is not uncommon to find the role of CFO and appointed actuary combined, especially in newly developing markets such as Korea and Vietnam. This role can be the stepping-stone to a country manager role. As an observation, Australian actuaries seem to fit the combined CFO/AA role more easily than do their UK counterparts is there something that could be learnt from this?
Another field where actuarial skills are in great demand is that of product development and product marketing, particularly in the more developed markets, namely Hong Kong and Singapore. While local actuaries have the necessary skills and experience to develop traditional with-profit-type products, they have not generally had exposure to investment-linked products and therefore there is a need to import highly technical product developers from both the UK and Australia. The appointment is normally made with the intention that, in addition to creating these new products, the expatriate actuary is also training the local actuaries in this area as, increasingly, companies are seeking to employ local rather than expatriate staff, for both economic and political reasons.

General insurance actuaries
For GI actuaries, Asia does not present the same breadth of opportunities. While life offices need appointed actuaries to meet regulatory requirements, many non-life offices operate branches in the various countries, with the majority of actuarial staff employed in head office. It is thought, however, that with the opening up of the Chinese insurance industry, the regulators could insist on each office having a chief actuary in situ, which requirement would obviously increase demand.
There are various opinions on what the development of the Chinese market will do to employment in the rest of the region. One argument runs that it will create a ‘brain drain’ from countries which include Mandarin-speaking Chinese, such as Taiwan, Hong Kong, and Singapore, while the counter-argument suggests that the Chinese themselves will want to move to those countries, once they have learnt the necessary skills from ‘expatriate’ professionals.

Cultural awareness
Cultural sensitivity and awareness are becoming increasingly important for expatriates wishing to work in the region. Even in the fairly recent past, companies tended to recruit purely on technical and commercial ability rather than considering the ‘fitability’ of an individual. Across the region several expatriate appointments, not just actuarial, have failed both because the incumbent did not possess this cultural sensitivity, and because companies often provided no cultural induction. This problem is now being addressed, both by recruitment consultants which consider the cultural adaptability of candidates to be as important as more tangible skills, and by the companies, which are increasingly sending new expatriate employees on cultural induction courses, run either by specialist companies or the Western embassies. Increasingly, spouses are also being offered the same courses, to ensure that the family adapts to the country and is therefore less likely to want to return home. Companies are also beginning to look for a willingness to learn the local language.
For most people moving to Asia, they must expect either to return to their home country after a relatively short period, or to be geographically mobile within the region. Often the route to promotion lies within another country, and therefore most assignments, even when taken on a permanent contract, are for only two to three years.
While Asia clearly presents an excellent opportunity for career progression, it should certainly not be presumed that lower levels of actuarial ability are required. Indeed, markets such as Hong Kong and Singapore require the same degree of technical expertise as does the UK. Clearly, in the less developed markets products tend to be simpler, but the converse of this is that broader managerial skills are often required in these countries, combined with the ability to ‘multi-task’.

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