LONDON - German reinsurer Munich Re has embarked on its plans to expand in primary insurance in Asia by providing the reinsurance for a new direct online insurance facility launched in Singapore on Thursday.
Munich Re, which helps insurance companies pay for major losses, has teamed up with global insurance investor and services provider, Whittington Group, to launch DirectAsia.com, which will offer motor, travel, home and personal accident insurance through the website.
The world's biggest reinsurer said it was seeking expansion in primary insurance in Asia, mainly through joint ventures and organic growth.
'The introduction of direct insurance is long overdue in most Asian countries,' said Anthony Hobrow, group chief executive of Whittington Group.
Whittington Group said virtually all personal lines insurance in Asia is sold through agents - who take commissions ranging from 10 per cent to 50 per cent.
'We have already seen the success of the direct business model in many other markets around the world, including Japan and South Korea,' he said.
Alexander Lay, head of casualty underwriting at Munich Re Singapore, said the move highlights the reinsurer's position as a high value solution provider in Southeast Asia.
'Our reinsurance agreement gives DirectAsia.com access to our international network, consulting expertise and extensive know-how,' he said.
This is not the first time Munich Re has provided reinsurance support for a primary insurance venture. The German reinsurer has a long-standing contract with Admiral Group to provide part of its reinsurance for its Elephant car insurance operation in the United States.
Munich Re's chief executive officer Nikolaus von Bomhard told Reuters on Tuesday it expects to generate 15 per cent of its business from Asia in the near future, up from 11 per cent now.
He said the German reinsurer is looking for partnerships in China and India to start life or non life insurance businesses.
DirectAsia.com will be licensed and regulated by the Monetary Authority of Singapore. – REUTERS