Asia’s Reinsurers Look Abroad as Domestic Growth Slows

Asia’s reinsurers are increasingly expanding into mature overseas markets to diversify risk and better manage underwriting cycles, according to a new report by AM Best.

The report, Asia in Focus: A Two-Way Street for Reinsurance Diversification, shows that most companies in AM Best’s Asia Reinsurance Composite recorded higher net income in 2024, with Chinese players leading the gains. The composite’s weighted average return on equity climbed to 11.3% last year, supported by stronger underwriting results and investment income.

“Asia-Pacific reinsurers are turning more toward international markets as China’s economic momentum slows and mature markets like Japan and South Korea confront demographic and economic headwinds,” said Christie Lee, senior director at AM Best.

Reinsurers in Singapore and South/Southeast Asia also maintained solid earnings in 2024, broadly flat year-on-year but still near historic highs. AM Best noted that capacity rebuilds alongside pricing adequacy have intensified competition.

However, April renewals in Japan reflected reduced revenue from higher retentions and rate cuts, trends that could contribute to softer conditions for the January 2026 renewals, the report warned.

AM Best highlighted that fewer disaster losses and more investment income helped Asian reinsurers achieve better returns in 2023. The region’s reinsurers’ combined ratios improved from 94.5% to 91.6%, while return on equity increased from 0.1% in 2022 to 9.2%.