A recent study by Clearwater Analytics has highlighted a significant divide among Asia-Pacific (APAC) insurers regarding regulatory compliance strategies. The research, which surveyed insurance asset management executives managing a total of $3.823t in assets, found that 48% of insurers cite meeting internal and external reporting demands as their primary challenge in adhering to financial regulations.
The study revealed that smaller firms, with assets under management (AUM) between $1b and $5b, and medium-sized firms, with AUM between $5b and $10b prioritise reporting demands. In contrast, larger firms, with AUM ranging from $10b to over $50b, focus on adapting to regulatory changes.
Beyond reporting, 35% of respondents identified adapting to regulatory changes as their biggest challenge, whilst 13% pointed to the difficulty of meeting varying requirements across different regimes. The study included executives from life and health insurers, general insurers, and third-party investment firms in Hong Kong, Singapore, and Australia.
Looking ahead, 14% of executives anticipate significant difficulty in meeting changing regulatory requirements over the next three to five years, with another 18% expecting moderate difficulty. Despite these concerns, 37% of respondents believe insurers are excellent in compliance, and 55% rate them as very good.
Shane Akeroyd, Chief Strategy Officer and President of Asia Pacific at Clearwater Analytics, noted, “Small firms are struggling with current reporting demands whilst large firms are positioning for future regulatory changes. This divide will become more pronounced as requirements continue evolving across multiple jurisdictions.”
The study underscores the need for insurers to develop integrated compliance capabilities to navigate the increasing complexity of regulatory environments.
