oecd asia regional expert seminar · oecd asia regional expert seminar: enhancing transparency and...
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OECD Asia Regional Expert Seminar:OECD Asia Regional Expert Seminar:Enhancing Transparency and Monitoring of Insurance MarketsEnhancing Transparency and Monitoring of Insurance Markets27-28 January 2012, Bangkok, Thailand
A Stocktaking and Comparative Assessment of Insurance Statistics in Selected Asian Countries: Preliminary Findings
Insurance and PensionsFinancial Market
W. Jean Kwon, Ph.D., CPCU
Faculty Chair and Professor
Disclaimer: The findings are preliminary and subject to reconfirmation by the participating institutions. All government agencies and their delegators responsible for data collection, administration and/or dissemination are welcome to offer their comments to the consultant ([email protected]).© 2012
Financial MarketOECDParis
Faculty Chair and Professor OECD External ConsultantThe School of Risk ManagementSt. John’s UniversityNew York
Importance of
Background
• Promoting efficient, open, stable and sound markets
• Maintaining high levels of transparency, confidence and integrity in the markets
The OECD Global Insurance Statistics as a unique source of comparable data since 1992.
The School of Risk Management,Insurance and Actuarial Science
• Gaps exist with non-OECD countries
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Issues of data/statistics availability from and consistency between
Background
between
1. Public and online sources
• Often, government agencies and/or industry associations
2. Private statistical agencies
The School of Risk Management,Insurance and Actuarial Science
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The institution responsible
A t it d l t
The Survey
• A government agency or its delegator
Data collection and management
• Collection method/frequency and data verification
• Scope of data: company vs. market level
• Dissemination of the data: collected vs. made public
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Issues
• Regional/international harmonization
• Accounting standards
• Challenges
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15 Participating Countries*
Bangladesh
Bh
Korea
M l i
* 88.3% response rate** Two participating institutions
Bhutan
Brunei
Cambodia
China, P.R.
Hong Kong, SAR
India
Malaysia
Pakistan
The Philippines
Singapore
Sri Lanka
Taiwan**
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India
Indonesia
Japan**
Taiwan
Thailand**
Vietnam
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Survey Findings
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All has at least one official agency as the responsible institution
1. Institutions Responsible for Insurance Statistics
institution
The following countries (3) also have:
• Brunei Economic Planning & Development Dept.
• Japan Statistics Bureau(Statistical Research & Training Institute)
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• Korea Financial Supervisory Agency
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Many, if not all, also note industry associations as supporting institutions commonly:
1. Institutions Responsible for Insurance Statistics
supporting institutions, commonly:
• Life Insurance Association
• Nonlife Insurance Association
• Remarks:
• Japan Statistical Research and Training Institute
K K I D l t I tit t (KIDI)
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• Korea Korea Insurance Development Institute (KIDI)
• Taiwan Taiwan Insurance Institute (TII)
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Government CompaniesAssociation
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1. Institutions Responsible for Collection and Administration of Insurance Statistics
Country Institution
Bangladesh Insurance Development and Regulatory AuthorityBangladesh Insurance Development and Regulatory Authority
Bhutan Royal Monetary Authority of Bhutan
Brunei Insurance/Takaful and Capital Market Supervision, Autoriti MonetariBrunei Darussalam
Cambodia Ministry of Economy and Finance
China, P. R. China Insurance Regulatory Commission
Hong Kong Office of the Commissioner of Insurance
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India Insurance Regulatory and Development Authority
Indonesia Capital Market and Financial Institution Supervisory Agency
Japan Financial Services Agency
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1. Institutions Responsible for Collection and Administration of Insurance Statistics
Country Institution
Korea Financial Supervisory ServiceKorea Financial Supervisory Service
Malaysia Bank Negara Malaysia
Pakistan Securities and Exchange Commission – Insurance Division
The Philippines Insurance Commission
Singapore Monetary Authority of Singapore
Sri Lanka Insurance Board
Taiwan Financial Supervisory Commission, Executive Yuan
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p y ,
Thailand Office of Insurance Commissioner
Vietnam Insurance Supervisory Authority
Insurance Regulators Globally
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Electronic (9)
2. Primary method(s) for collection of insurance statistics (financial statements)
• The Financial Information Exchange System (Korea)
Softcopy (11)
Hardcopy (11)
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* Multiple responses permitted
3. Frequency of Collection
Monthly Quarter Yearly Yearly
Full Partial Full Partial Full Partial
Monthly (full): Bhutan, India, Korea, Taiwan
Quarter yearly (full): Indonesia, India, Japan, Korea
Full Partial Full Partial Full Partial
4 6 5 5 13 1
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Yearly (partial): Cambodia
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March 31 (4)
4. Closing Date for Financial Statements
• India, Japan, Korea, Vietnam
December 31 (11)
• Bangladesh, Bhutan, Brunei, Cambodia, Indonesia, Pakistan, the Philippines, Singapore, Taiwan, Thailand
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Flexible (1)
• Malaysia (Companies are free to set their FYE.)
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How flexible are you to move the closing date to, for example December 31?
Question!
example, December 31?
• India
• Japan
• Korea
• Malaysia
• Vietnam
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Has a formal procedure (11)
5. Data Validation
Conducts a random validation (2)
• India, Pakistan
Treats the submission as “final and complete” (2)
• Bangladesh, Japan
Remarks:
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Remarks:
• Built-in check & manual trend analysis (Malaysia)
• Built-in check of business data only, not including financials of nonlife companies (Taiwan)
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1 month (Korea, Taiwan-life, Pakistan)
6. From Receipt to Making Public, It Takes
Up to 2 months (Singapore, Thailand, Taiwan-nonlife)
3 months (Malaysia)
6 months (India, the Philippines)
10 months (Indonesia)
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No reply (5)
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Yes (11)
7. Revision Plan for Data Collection Method
• Brunei (new system in September 2011 )
• India (examines an electronic filing system)
• Indonesia (develops an electronic filing system)
• Malaysia (develops an Integrated Statistical System)
• Singapore (examines further streamline of the process)
• Thailand (plans IT improvement)
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No (4)
• Cambodia, Japan, Korea, Pakistan
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8. Webpage for Insurance Statistics
Not Making Public Online (5)Yes (10)
Bangladesh
Bhutan
Brunei
Japan (via LIA & GIA)
Vietnam
Cambodia
India
Indonesia
Korea
Malaysia
Pakistan
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Pakistan
The Philippines
Singapore
Taiwan
Thailand
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9. Making Public of Data/Statistics
Partial DataAll Collected Data
At the company/market level (9)
• Cambodia, India, Indonesia, Malaysia, Pakistan, the Philippines, Singapore, Taiwan, Thailand
At the company level (1)
• Vietnam
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At the market level (3)
• Korea, Taiwan, ThailandPremiumLoss (Claims)
ExpensesReinsurance
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9bc. Data Collected vs. Made Available
Country Has Collected Data Since Currently Makes Available Since
Cambodia* 2003 2007 [2008]
* Limited data collected** Not available online (softcopy)All publishing years to be verified
Cambodia 2003 2007 [2008]
India 2005 2005
Indonesia 1998 1998
Korea 1979 1998
Malaysia 1990 2005
Pakistan 2006 2006
The Philippines 1980 2004
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pp
Singapore 1980s 1999
Taiwan 1990 (L); 1985 (N) 1990 (L); 1985 (N)
Thailand 2003 2003
Vietnam** 2002 2004
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When available (10), it is commonly free of fee
11. Online Data Available Free of Fee?
Remarks
• May also be available in hard copy (with a fee)
• Korea (membership/registration required for online access to the KIDI-administrated statistics)
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All countries (12) collect such data except:
13. Collection of Data Separately for New Business
• Cambodia, Malaysia
Remarks
• Brunei (premium data only)
• Japan (selected as stipulated in the law)
• Singapore (premium and distribution for life and life
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g p (preinsurance)
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No countries are known to use other sources directly.
14. Use of Statistical Sources
Some materials for reference only, for example:
• Sigma (4)
• ASEAN Insurance Statistics (1)
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15. Strengths and Weaknesses
WeaknessesStrengths
Data quality & reliability
Small insurance market
Timeliness
Comparison between markets as well as among different types of insurers
Well-designed submission forms
System infrastructure
Centralized database management system
Continuous investigation for
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ypgsystem improvement
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Generally Accepted Accounting Principle (10)*
16. Accounting Principle
• Bhutan, Brunei, India, Indonesia, Japan, Malaysia, Pakistan, the Philippines, Taiwan, Vietnam
Statutory Accounting Principle (8)
• Bangladesh, Cambodia, Indonesia, Japan**, Korea, Malaysia, the Philippines, Thailand
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Other (1)
• Singapore (Singapore Financial Reporting Standard)
* Bhutan, Brunei, and the Philippines in line with the International Accounting Standard or the IFRS.** GAAP is reflected in SAP (Japan)
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Information technology and expertise
17. Difficulty in Implementing Local Accounting Standard/Principle
Availability of data to support accounting/disclosure requirements
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Data Collection Scope:Collected vs. Making Public(Company Level Only)
Life Nonlife Composite
Written Premium Amount (15)
12. Data – Premium
(Number of Responses) (Published/Collected)
Written Premium Amount (15)
Direct Business 8/14 8/15 2/5
Reinsurance Accepted 4/12 5/14 2/5
Reinsurance Ceded 5/13 6/14 2/5
Number of Policies (14)
Direct Business 6/13 4/13 2/5
Reinsurance Accepted 3/6 2/6 2/4
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p 3/6 2/6 2/4
Reinsurance Ceded 2/6 2/6 1/3
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Life Nonlife Composite
Loss/Claims Amount (13)
12. Data – Loss/Claims
(Number of Responses) (Published/Collected)
Loss/Claims Amount (13)
Direct Business 6/13 6/14 2/4
Reinsurance Accepted 4/11 5/12 2/4
Reinsurance Ceded 5/12 6/12 2/4
Number of Claims (12)
Direct Business 5/12 5/11 2/4
Reinsurance Accepted 1/6 2/7 2/4
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p 1/6 2/7 2/4
Reinsurance Ceded 1/6 2/7 2/4
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Life Nonlife Composite
Operating Expenses (13)
12. Data – Operating Expense
(Number of Responses) (Published/Collected)
Operating Expenses (13)
Direct Business 6/12 6/13 2/4
Reinsurance Accepted 1/6 2/8 1/3
Reinsurance Ceded 1/6 2/6 1/3
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Life Nonlife Composite
Cash & Equivalent (15) 8/14 8/15 3/5
12. Data – Balance Sheet (Assets)
(Number of Responses) (Published/Collected)
Cash & Equivalent (15) 8/14 8/15 3/5
Bond (13) 7/12 6/12 2/4
Public (12) 5/11 5/12 2/4
Private (11) 5/11 5/11 2/4
Mortgage Loans (12) 5/11 5/12 1/3
Other Loans (15) 6/14 6/15 2/5
Stock (13) 7/13 7/13 2/5
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Stock (13) 7/13 7/13 2/5
Public (9) 4/9 4/9 2/3
Real Estate (15) 8/13 6/14 3/5
Other Investments (15) 8/13 8/14 3/5
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Life Nonlife Composite
Unearned Premium Reserve (14) 7/13 8/14 3/5
12. Data – Balance Sheet (Liabilities)
(Number of Responses) (Published/Collected)
Unearned Premium Reserve (14) 7/13 8/14 3/5
Loss Reserve (Tech Provision) (14) 8/13 8/14 3/4
Reinsurance Payables (13) 5/13 5/13 2/5
Borrowed Money (13) 3/12 3/12 1/4
Special Reserves (10) 4/10 4/10 1/3
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Life Nonlife Composite
Initial Capital (15) 7/14 7/15 3/5
12. Data – Balance Sheet (Capital)
(Number of Responses) (Published/Collected)
Initial Capital (15) 7/14 7/15 3/5
Additional Contributions (11) 5/11 5/11 2/4
Retained Earnings (15) 6/14 6/15 3/5
Earmarked Surplus (Any) (12) 5/12 5/11 2/3
Solvency Target Ratio* (7) 2/7 2/7 0/2
* Equivalent ratios as well
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Life Nonlife Composite
Earned Premium (14) 6/13 7/14 3/5
12. Data – Income Statement
(Number of Responses) (Published/Collected)
Earned Premium (14) 6/13 7/14 3/5
Losses Incurred (15) 8/14 8/15 3/5
Loss Adjustment Exp Incurred (10) 4/9 4/10 3/4
Underwriting Exp Incurred (10) 4/9 4/10 3/4
Net Investment Income Earned (13) 7/13 7/13 3/4
Net Realized Capital Gain (13) 7/13 7/14 3/4
Other Income (13) 7/13 7/14 3/4
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Other Income (13) 7/13 7/14 3/4
Interest Paid/Incurred (11) 5/11 5/11 2/4
Taxes Paid (14) 6/14 6/14 3/6
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Cambodia
Insurance DivisionFinancial Industry DepartmentMinistry of Economy and Finance
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Japan
Insurance Business DivisionSupervisory BureauFinancial Services Agency (金融庁)
Ministry of Finance (Minister for Financial Services, 財務大臣)
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New business premiums by lineSimplified income statementSimplified balance sheet
New business premiums by lineIncome statementBalance sheet
Full statistics
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Identical data in English pages
Thailand
Office of Insurance Commission
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Insurance Statistics
Monthly Data (Life)
Monthly Data (Nonlife)
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Quarter yearly & End of year
Year-to-year comparison
Annual data only
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From 1997
Data Scope Comparison:
Government vs Other SourcesGovernment vs. Other Sources
Thailand Nonlife Insurance
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Public source Office of Insurance Commission
Data Availability Comparison
Private sources ISIS Database andCompany’s websites:1. Bangkok Insurance (public)*2. Viriyah Insurance (private)*
Findings (selected)
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• Much longer period of data in the public source than in private sources
• Much fuller information in private sources than in the public source
* Largest in terms of gross premiums written in 2010 and 2009, respectively.
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Bangkok Insurance Company(ISIS Database)
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*
* The database shows results from 2004 through 2010.
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Remarks
Coordination of data/statistics collection processes
• Account closing date• Account closing date• Codification exercise in line with international development –
Financial statement entries• IT in selected countries• Efficiency in data verification in selected countries
Systemic approach for data dissemination
• In the public domain
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p• At the regulated company’s domain• To private statistical agencies
No harm from publishing all collected data
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We Welcome Your Comments
Thank You!