Happy Birthday to 20 years of Asia Insurance Review and all the best for every future edition.
When Asia Insurance Review was founded in 1991, an earlier chairman of Allianz, Mr Wolfgang Schieren, had the honour to write the very first editorial. At the time he described Allianz as “observing the Asian Markets” and he was predicting Asia to “play a dynamic role in the world economy”. How true has his prediction proven to be.
Asia has arrived
Today Asia has arrived on the world stage, economically and politically. The Fortune 500 list looked significantly different in 1991 with hardly any Asian company represented.
Today BRIC countries dominate this space. Asia has become a significant player in world’s economy and Allianz has developed from an observing investor into a significant player in Asian growth markets.
Aging of societies a global mega trend
When we think back to 1991, global mega trend challenges like the aging of societies had not been considered pressing for Europe, nor for America or Asia. Today the population of countries, for example Korea, Japan or Taiwan, is aging very rapidly and by 2050 will belong to the oldest societies worldwide.
People have to take action now to be able to retain their old age provision and quality of life. The natural life expectancy in industrialised countries today has already risen to over 100.
Today we are concerned and analysing these developments, but we will see the implications become reality within the next 20 years. This is one of the long-term and inevitable trends that the insurance industry has to deal with and that we will only be able to tackle with a global perspective.
Climate change – Threat and business opportunity
Twenty years ago, few talked about the ozone hole, followed by discussions about CFC-free products that would protect against global warming. In general, climate change was not an issue at the time. Even less in countries that were working hard to develop into emerging markets.
Today climate change is a global concern. The world is aware that it might become a major risk to the global economy, but doesn’t act sufficiently.
For the financial services industry it is simultaneously a threat and a business opportunity. The changing climate may result in a compounding of risks across the entire business spectrum, even diluting some of the benefits of portfolio diversification. At the same time, for example, risk coverage of new and emerging technologies is playing an important role for future developments in renewable energies. Other insurance solutions, eg for green housing, but also advice for our customers on how to mitigate their exposure to climate risks have become important tasks for Allianz.
Good corporate citizen
If we look back to 1991, the public would have expected a company to primarily produce quality products, pay good salaries and make profit. Environment, good governance and fighting against poverty were mainly regarded as be government duties.
Today it is an important responsibility for a multinational company to be a good corporate citizen. Rightly so, it has become more and more an integral part of the company’s culture and its business.
Disastrous natural catastrophes of the recent years have shown that most of the victims that had been severely affected are people who don’t have insurance cover.
Insurances with micro premiums provide protection against losses to those who need it most and often are most exposed to risks ranging from severe diseases to natural catastrophes.
Microinsurance policies have long been considered too complex and too cost-intensive to be financed with small amounts of money and marketed in rural areas. Teaming up with partners and using a simplified sales process is one of the opportunities to reach out to low income families. Today we are able to provide this protection to 3.8 million customers in eight markets. This is just the beginning of a business that we hope will help as many people as possible to attain prosperity.
In light of the huge challenges, but also tremendous chances that we are facing, I’m optimistic about the future of the financial services industry.
As the world emerges from the global financial crisis, requirements for financial stability and strength will remain very high and the ability to manage through times of crisis is a prerequisite to be a trusted partner for customers.
The past crisis has shown to the world quite plainly: security is invaluable. Customers around the globe have decided that security is a value they are willing again to pay for. Insurance companies are performing exactly this, they enable customers to use the chances life is offering them and let them sleep well at night.
That’s why Allianz is building the world’s strongest financial community, a community for all our stakeholders.
Mr Michael Diekmann
Chairman of the Board of Management