Insurance Executives in Asia Pacific and the Global Protection Gap
Recent findings from a survey conducted by SAS and Economist Impact shed light on the differing perspectives among insurance leaders worldwide regarding the US$1.8 trillion (£1.4 trillion) protection gap. This gap represents the disparity between insured and uninsured losses. The study surveyed over 500 insurance executives across 17 countries.
Globally, 79% of executives recognize an ethical responsibility to address this gap. However, within the Asia Pacific region, only 72% of insurance leaders share this sentiment. This seven-percentage-point difference highlights regional variations in the perception of ethical responsibilities in reducing this gap.
Climate Change and Economic Losses
The significance of these findings is underscored by the increasing frequency of climate-related disasters. In 2024, catastrophic events such as fires, floods, storms, and earthquakes contributed to global economic losses amounting to £289 billion, with 60% of these losses remaining uninsured.
Business Opportunities and Technological Solutions
Despite the lower ethical inclination in Asia Pacific, there is consensus on the business potential of closing the protection gap. Seventy-six percent (76%) of insurance leaders worldwide see this as a significant business opportunity, particularly as climate change continues to impact losses.
Technology is viewed as a key solution across all regions. Nearly half of the executives (48%) believe that implementing technologies to make insurance products more affordable is the most effective strategy. Other technological solutions include the creation of innovative insurance products such as parametric or microinsurance (42%) and utilizing data to enhance risk assessment and product design (38%).
Challenges and Industry Trust
Nonetheless, challenges persist. A significant 77% of insurance leaders cite a lack of trust in the industry as a barrier to closing the protection gap. Other obstacles include a limited understanding of consumer needs (76%), outdated technology systems (75%), and organizational silos (74%).
Sabine VanderLinden, CEO and co-founder of Alchemy Crew, commented, “With a £1.4 trillion global protection gap and mounting challenges, from climate change to fraud and cyber threats, the industry stands at a crossroads.”
