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The 9th Phil Non-Life Insurance Summit

(Article published in the Apr 18,2012 issue of Manila Standard Today)  

Somebody up there likes him.  Exactly two weeks before Reynaldo A. De Dios is to hold his 9th yearly summit for the region’s insurance industry on April 25, 2012 at the InterContinental Hotel in Makati City, an undersea earthquake, described by CNN as “the largest earthquake of its type ever recorded” occurs in Sumatra.  Recorded at 8.6 on the Richter scale, the quake known as a “strike-slip”, i.e. “where two sides of a fault horizontally slip past each other” excited the scientific community.  Says Director Kerry Seih of the Earth Observatory of Singapore: “Before that we thought at 8.1 was as big as they get, but this 8.6 quake was phenomenal. It has been jaw-dropping and has caused a lot of foment among seismologists.”

Fortunately, the Sumatra strike-slip did not cause much damage. Not so the other natural catastrophes that preceded it.  Rey De Dios, writing on the rationale for this year’s topic, describes “the rush of earthquakes, tsunamis, typhoons, floods, tornadoes and other types of natural perils in 2011 that occurred in Japan, New Zealand, Australia, Turkey, United States, the Philippines, and just recently the country-wide floods in Thailand” as “causing huge losses in property, manufacturing plants, and human lives.”

“The Disaster Research Risk Reduction Agency and other agencies of the United Nations,” continues De Dios, “reported a record US$366 billion damage whilst a total of 39,782 people lost their lives in 302 disasters, with storms and floods accounting for 70% of catastrophes.  Japan alone lost 20,943 lives while in total, 206 million people were affected by disasters, droughts and famines in that year.”
 










     

The insurance industry, as the sector charged with a vital role in risk transfer and loss mitigation, responded well.  But, though showing resiliency and capability to meet claims, which have been preliminarily estimated at US$100 billion already, the industry could not rest on its laurels.  Like a runner on a treadmill, it has to keep on going, and, better still, growing, just to stay where it is.

The 9th Philippine Non-Life Insurance Summit, after the opening statement from current Insurance Commissioner Emmanuel Dooc, immediately buckles down to work with  updates and reviews.  Dr. Pedro Benedicto, Jr., chairman of the Philippine Insurers and Reinsurance Association, Inc. and the president of Republic Surety and Insurance Company, Inc., a Meralco subsidiary, will give an update on the Philippine General Insurance Market.  He will be followed by Roberto B. Crisol, President and CEO of the National Reinsurance Corporation of the Philippines, with his update on the Philippine reinsurance market.  To put these developments in a global perspective, Peter Newall, flying in from Swiss Re’s Asia headquarters in Hong Kong  with his expertise in claims and liability management, will deal with “2011 in Review: Lessons in Claim from a Year of Catastrophic Losses.”

After the morning break, Kent Chaplin, a barrister and solicitor in New Zealand who in January 2011 was appointed head of Asia Pacific and Managing Director of Lloyd’s Asia, will talk of “Managing Natural Catastrophes with Emphasis on Effective Claims Management.”  IT will then take center stage as Suzanne Corona, with her 17 years of industry experience and presently leading the perils division at Asia Capital Reinsurance, discusses how to enhance viable platforms for managing catastrophe risk in Asia.  Aptly, her talk is entitled, “Black Swans: Is there a sustainable solution?”  Completing the morning session, that is to be chaired by Richard Austen who is CEO of Asia Reinsurance Brokers Pte. Ltd in Singapore, is Richard Sanders whose talk will be on “Measuring Unmodelled Perils and their Regulatory Requirements”.  Sanders’ specialization is in non and poorly modelled territories and hazards, in flood modelling and in marine cargo risk analysis. 

Chairperson Herminia Jacinto, who president of the Insurance Institute for Asia and the Pacific, will begin the afternoon sessions by calling on Aladdin D. Rillo, currently the director and chief economist of the Asean Integration Monitoring Office of ASEAN’s Secretariat in Jakarta, to speak on “The Impact of AFTA on Asean Insurers.”  Then, Moung Mo Lee, the General Manager of Analytics at A.M. Best Asia-Pacific Ltd and responsible for A.M. Best’s ratings in the Asia-Pacific region, will discuss “The Impact of Natural Catastrophes on Ratings and Risk-based Capitalization”, a serious topic here where risk-based capitalization of the financial sector is being pushed by the government.  Before afternoon tea is served, Roberto G. Manabat, chairman and CEO of KPMG Manabat Sanagustin & Co, will deal with the “Latest Developments in Insurance Accounting and Regulations.”

The fourth quarter of the day will begin with “Managing Your Risk Appetite Using Dynamic Financial Analysis” by Patrick Grealy who is a Fellow at the Institute of Actuaries in the UK. His 20 years experience in property and casualty insurance is made up of stints at the Imaging Group, XL Capital, Price Waterhouse Coopers and Towers Perrin Tillinghast.  Then Jiang Fenghui, based in Shanghai as Chief Engineering Technical Specialist for Great China Operation, will speak on “Efforts Prior to Risk Transfer – Risk Identification and Mitigation.” He is a flood specialist and in charge of developing and implementing Asia Flood Goals and Objectives of Asia Operation.

The long day will end where it started, i.e. about the Philippines. Matthew Jakab, will talk on “Risk Analysis Project for the Greater Metro Manila Area—a Philippines-Australia Partnership.” Jakab is currently leading the development of value-added spatial datasets for AusAID funded multi-hazard risk analysis activities in the Philippines as well as in Papua New Guinea.  Although his work product is proprietary to his funders, his ideas generated particularly by his experience the past five years heavily focused on the application of special data analysis for the understanding of the impacts of natural hazards will be giving the participants in the summit much to think about their personal vulnerability, for the rest of the evening and thereafter.

           As with the past eight summits, Rey de Dios’ coming conference is a must-attend for serious players in the insurance industry.  This year’s brings together the implications of the convergence of three major developments on non-life insurance: (a) increased occurrence of several natural catastrophes; (b) enhanced regulatory requirements prompted by said recent and (c) more stringent reporting demanded by the evolving nature of the business.  Participants ought to come early; a over-flow crowd is expected.

     

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