As 2025 approaches its final quarter, insurance markets across the Asia-Pacific region are navigating one of their most complex periods in recent years. Premium growth has slowed amid rising competition and macroeconomic pressures, according to Gallagher Re’s Asia Pacific Market Watch 2025 report.
Despite these challenges, opportunities for expansion remain, particularly for insurers demonstrating strong underwriting practices and portfolio quality. The reinsurance market continues to show support heading into 2026 renewals, with capacity returning after several years of tightening.
Regional Growth and Market Performance
The report highlights a diverse and resilient insurance landscape across 14 APAC markets. Financial results for 2024 were generally robust, with continued growth in non-life insurance premiums, though the pace of expansion has moderated in several areas.
Emerging markets such as Vietnam, India, and Malaysia posted notable non-life premium growth rates of 15.8%, 12.8%, and 7.7% respectively. In contrast, mature markets like Singapore, South Korea, and Thailand saw slower growth between 0.8% and 3%.
While mature economies grew an average of 1.4% in GDP terms, emerging economies expanded by about 5.1%, with Southeast Asia performing strongly. Vietnam (7.1%) and the Philippines (5.7%) led the region’s economic growth.
However, trade-dependent markets such as China and South Korea may face medium-term pressure from slowing global trade. Additionally, falling inflation and potential interest rate declines could reduce investment income, prompting insurers to balance growth with disciplined capital management.
Rising Climate Risks and Catastrophe Exposure
Natural catastrophes continued to influence the region’s insurance landscape in 2025. Major events included the March earthquake that struck Myanmar and Thailand, and Tropical Cyclone Alfred in Australia.
With urban development expanding into high-risk areas and climate variability increasing, insurers are turning to tools like parametric insurance, catastrophe bonds, and risk-based underwriting. The SEADRIF Insurance Company’s disaster financing program for Laos was cited as an example of innovation in this space.
Regulators across the region are also enhancing climate resilience by developing frameworks, disclosure standards, and action policies.
Regulatory Reform and Market Liberalization
Most APAC jurisdictions have adopted or are preparing to implement IFRS 17 accounting standards and risk-based capital (RBC) frameworks. These regulatory updates are reshaping solvency strategies and influencing how insurers structure reinsurance and deploy capital.
Several markets are advancing liberalization efforts. Vietnam has lifted restrictions on foreign ownership, while India’s GIFT City initiative promotes cross-border insurance activity through low-touch regulation. Strengthened data protection and artificial intelligence governance laws are also emerging as potential drivers for cyber insurance growth.
Expanding Digitalization and Emerging Sectors
Digital transformation continues to accelerate across the region. Online distribution channels, embedded insurance models, and AI-driven underwriting tools are becoming more prominent. Malaysia’s digital insurer licensing program is among the regulatory efforts supporting innovation.
Key areas of growth include health insurance in India, Hong Kong, and Vietnam; electric vehicle and renewable energy coverage in China, Singapore, and Taiwan; and cyber insurance in Australia, Singapore, and South Korea.
At the same time, insurers face new pressures such as rising medical inflation and the unique underwriting challenges of electric vehicle batteries.
Reinsurance Market Trends
Reinsurance conditions have eased after several years of rate increases, with 2025 bringing renewed capacity, lower rates, and more favorable treaty terms. Reinsurers’ capital strength has enabled greater collaboration on new products and market development.
However, selectivity remains a key feature of the reinsurance environment, with disciplined underwriting and robust data quality continuing to influence pricing and partnership opportunities.
Looking Ahead
As Asia-Pacific economies adapt to slower global trade and more competitive conditions, insurers are focusing on quality as a defining factor for resilience. The region’s insurance sector faces a complex mix of economic, environmental, and regulatory pressures, yet remains positioned for growth through innovation, discipline, and diversification.
Gallagher Re’s Asia Pacific Market Watch 2025 report will be officially released on October 27, 2025.
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