The Asian Captive Conference details what’s in store for this year’s event and offers insight into the opportunities and panel discussion that will be on offer
Could you provide some insights into the theme, ‘The Connected Risk Journey in Self-Insurance’? How does this theme address the current challenges and opportunities in the changing risk landscape?
With the development of a digital and borderless business world, the risk solutions offered by traditional insurance companies may not be able to cope with this new business environment. However, captive insurance is poised to cater to this changing landscape, by providing tailor-made insurance policies while having direct access to the global wholesale reinsurance market to meet non-conventional risks. It’s a long-term risk plan, connecting businesses to collectively provide risk management solutions for a more robust risk environment.
The conference will discuss IFRS17 requirements and their impact on self-insurance. What specific aspects of IFRS17 will be covered, and how will the discussions help captives understand and adapt to these requirements?
Various aspects of how IFRS 17 pertains to captives or self-insurance entities will be discussed during the conference. The discussions will encompass the following key areas:
- Scope and Applicability: Understanding which entities fall under the scope of IFRS 17 and how captives are affected by its application
- Measurement and Recognition: Delving into the methods and principles used to measure insurance contracts and how captives can effectively recognise their insurance liabilities under the new standard
- Financial Statements Presentation: Explaining how captives should present their insurance contracts in their financial statements, including any required disclosures
- Transition and Implementation: Assisting captives in navigating the transition from existing standards to IFRS 17 and providing guidance on a smooth implementation process
- Impact on Captive Operations: Analysing the potential effects of IFRS 17 on captive business models, risk management practices, and financial strategies
By exploring these specific aspects, the discussions aim to equip captives with a comprehensive understanding of IFRS 17 and its implications. Attendees will gain insights into the challenges and opportunities that the new standard presents, helping them to adapt their financial reporting and risk management practices effectively.
We are confident that the conference will offer valuable insights and practical guidance for captives to navigate the complexities of IFRS 17 successfully. It will also provide a platform for networking and knowledge-sharing among industry experts and practitioners.
The event includes dedicated break-out sessions: ‘Captive 101’ for participants interested in forming a captive and ‘Advanced Captive’ for existing or representative captive owners. What are the key takeaways attendees can expect from these sessions, and how will they address the different needs of participants?
In ‘Captive 101’, the audience can gain a better understanding of how and why they should form or establish a captive. They will be guided on the relevant steps and on how to manage their risks and profit and loss.
In ‘Advanced Captive’, the audience can expect to hear from matured captive owners on why they chose to establish a captive, their captive’s evolution over the years as well as best practices and challenges associated with owning a captive.
The sessions will comprise presentations and sharing from captive managers, fronting and reinsurance partners, tax experts and investments specialists.
In the panel discussion on ‘The Connected Risk Journey in Self-Insurance’, you mentioned emerging risks in cyber and employee benefits. Can you provide some examples of these emerging risks and how self-insurance strategies can effectively address them?
Emerging risks and self-insurance strategies in employee benefits (EB):
- Finance insured EB to bring greater degree of control on cost and to provide insights on claims patterns;
- As a tool to support Diversity, Equity & Inclusion (DEI) objectives, especially for multinational organisations.
Emerging risks and self-insurance strategies in cyber:
- As the use of technology increases, the risk of cyber breaches heightens. Traditional insurance faces difficulty when dealing with the many facets of cyber risk.
- A captive insurer provides organisations with flexibility and options for their cyber risk management strategy. For example, having cyber coverage in a captive allows them to pivot during or prior to a renewal in three key areas: cost, capacity, and cover.
The agenda includes a panel discussion on parametric insurance and its role in achieving ESG goals. Could you elaborate on how captives can contribute to ESG goals and how specialised parametric insurance can facilitate this?
Captives are poised to play a key role in the ESG space as they are well-positioned to identify, implement and document a company’s ESG issues and address them accordingly. An ESG framework can be based on the four key aspects of captive operations: governance, including ESG considerations in strategic planning; underwriting risks, by understanding and incorporating the impact of ESG risks (such as cyber and climate change risks); investments, with the incorporation of sustainability goals into investment guidelines and the expansion of sustainable investments; and reporting, ensuring that ESG reporting requirements are fulfilled at the board level.
This framework will enable captives to help parent companies understand their overall risk profile and mitigate risks on the ESG spectrum to reduce the probability or severity of potential claims, thus reducing the company’s total cost of risk. In a nutshell, embracing sustainability will allow captives to elevate their profile, inform stakeholders on the role of captives and offer the sector a refreshed relevancy in the long term.
Parametric coverages are playing a growing role in mitigating ESG-related risks such as climate change, cyber and reputational harm. It is called parametric insurance because policy parameters are set around a specific set of metrics. Unlike traditional insurance, parametric insurance does not indemnify the insureds against their actual losses.
Parametric triggers offer a faster payout than traditional insurance and require no loss assessment. The level of payout is based on a triggering event that exceeds a certain threshold or set parameters, such as hurricane wind speed, temperature or rainfall which are measured by a third-party index.
This allows parametric insurance to facilitate ESG goals as it is able to provide cover for complex, hard-to-define risks, such as climate change, sustainability issues and even governance matters, using clear and straightforward metrics.
Networking opportunities are an important aspect of conferences. Could you share more details about the networking breaks and how attendees can connect with industry experts and peers to foster meaningful collaborations?
Attendees will be having three official networking breaks, including lunch. In addition, they will also have opportunities to network before the conference proper and after the conference ends. This will allow attendees to mingle with the varied audience from the captive ecosystem, including regulators, captive owners and service providers. We will have several exhibition booths outside the conference room featuring a mix of services providers offering actuarial, insurance, captive and company secretarial solutions. Overall, the Asian Captive Conference 2023 will provide a great platform for attendees to network and discuss latest trends and challenges while forging mutually beneficial captive partnerships.
As the Asian Captive Conference enters its sixth year, what sets this event apart from others in the industry? How do you ensure that attendees receive valuable insights and practical strategies that they can implement in their respective roles?
The Labuan IBFC Strategic Roadmap 2022-2026 aims to position Labuan IBFC as a leading captive hub. In line with this, the centre is now home to 67 captives, and has witnessed growth in the captive space over the last decade. As such, the Asian Captive Conference 2023 will attract top minds and influencers within the region’s captive space. We have ensured that we have a diverse mix of speakers and panellists who are subject matter experts in their respective areas and are willing to share and disseminate the correct information and experience regarding captives. This will help attendees receive updated, practical information.
