Asia focused round table on the role of actuaries in insurance regulation delivered by UNDP, Milliman, A2ii, IAA and the IAIS
Asia focused round table on the role of actuaries in insurance regulation delivered by UNDP, Milliman, A2ii, IAA and the IAIS
POSTED 08 October, 2024
The roles of actuaries in the insurance industry are well established. How these roles can be formalized to support regulators in their supervisory process is less well known. Scarcity of actuarial capacity in many developing countries and lack of in-house actuarial capacity within regulatory authorities has meant that the role of actuaries in insurance regulations has not been properly defined.
With this challenge in mind, an Asia-focused regulatory round table event was held in Malaysia on 20th of September 2024. The convening explored how supervisors can look to actuaries and the actuarial function - within insurance companies as well as in the regulatory office - as important contributors to effective supervisory processes. The discussion was an opportunity for regulators across region to be part of peer-to-peer learning session.
40 participants with diverse levels of regulatory experience attended from across 15 regulatory jurisdictions in the Asia and the Pacific region. Countries represented include Cambodia, Indonesia, India, Astana International Financial Centre, Malaysia (Labuan), Macao, Malaysia, Maldives, New Zealand, Oman, Philippines, Singapore, Solomon Islands, Sri Lanka and Nepal - with 15 regulatory staff from the Nepal Insurance Authority (NIA) joining the roundtable virtually.
The session explored how different supervisory philosophies, insurance market landscapes and states of development of the actuarial profession within and outside of the jurisdiction influence the regulatory roles of actuaries. The aspiration of supervisors to build actuarial capacity within the insurance market also defines the eligibility criteria for an individual taking up that role, and the type of statutory duties they are required to carry out. Participants shared their experience on the evolution of their regulatory regime and how they are supporting the insurers to enhance actuarial capability within the industry.
“Participating in this roundtable has provided valuable insights into how actuarial expertise can be leveraged to enhance the supervisory process. At the Astana Financial Services Authority (AFSA), which is a regulatory body of the Astana International Financial Centre (AIFC), we are keen to apply these lessons to enhance our regulatory framework and strengthen the role of actuaries within our market.”
— Bizhigit Sagidolla , Senior Associate (Actuary), Prudential Division of the Astana Financial Services Authority of the Astana International Financial Centre
The discussion around roles of actuaries in regulatory authorities delved into increasing demand for actuaries working for regulators and explored various ways to support this demand. Guest speakers from the Bank Negara Malaysia (BNM) shared their experience in recruiting and retaining actuarial talents.
The Insurance Regulatory Commission of Sri Lanka (IRCSL) shared experiences of managing to ensure oversight of the outsourced actuarial function within the regulatory office.
"The regulatory roundtable session was incredibly valuable in providing a platform for learning with peers invited from several regulatory bodies and understanding the diverse challenges and solutions faced by different countries in building actuarial capacity. The opportunity to exchange insights and experiences with colleagues from around the world has been instrumental in broadening my perspective and identifying potential strategies to address the unique challenges we face in Sri Lanka".
— Shyamalie Attanayake , Assistant Director Actuarial Supervision, Insurance Regulatory Commission of Sri Lanka
Following their virtual roundtable participation, the regulatory staff of the Nepal Insurance Authority received tailored training from Milliman Ambassadors on technical topics (review of product pricing and reinsurance) to support in their supervision work.
“The insights gained from this program have been invaluable. Our experience shows that continuous collaboration between regulators and actuaries can significantly improve the oversight process, ultimately benefiting the industry and consumers alike. The practical examples and collaborative discussions will help us refine our approach to product oversight and enhance our understanding of pricing strategies. By applying these learnings, we aim to strengthen our evaluation processes, ensuring that we can better serve our market, protect policyholders, and promote a stable, resilient insurance industry in Nepal.”
— Ram Koju, Deputy Director, Nepal Insurance Authority
The Asia regulatory round table was held alongside an actuarial capacity building training for insurance supervisors organized by A2ii, IAA and IAIS, in partnership with ASEAN-AITRI and supported by Bank Nagara Malaysia.
The roundtable is the second in a series that will continue providing much-needed support for regulators and actuaries to share insights and gain new perspectives from experts and regional peers. The first regulatory roundtable was held for regulators and industry participants from Latin American region.