MAS sets aside $30m to help insurers build expertise in funding major projects

The Monetary Authority of Singapore (MAS) has allocated $30 million to assist insurers in developing expertise in funding large-scale projects, such as power grids and data centers. This initiative aims to expand insurers' roles in financing Asia's growth, alongside risk protection. The funding, sourced from the Financial Sector Development Fund, will cover expenses related to establishing dedicated investment teams, staff training, and engaging professional services.

Chee Hong Tat, Minister for National Development and Deputy Chairman of MAS, highlighted that high-quality infrastructure assets can generate stable cash flows, aligning well with insurers' long-term liabilities. He noted that currently, only 1% to 2% of insurers' assets are invested in infrastructure projects, despite a growing trend.

MAS proposes lowering capital requirements for qualifying debt investments in these projects, contingent on factors like credit ratings, low risk, and contractual revenue stability. Additionally, the authority suggests reduced requirements for certain rated investments backed by pooled assets, subject to specific conditions. These proposed changes are currently under public consultation until December 18.

Meanwhile, the Singapore Reinsurers’ Association (SRA) launched a handbook to help reinsurers evaluate risks associated with artificial intelligence. The guide covers concerns such as data reliability, AI decision-making, reliance on external providers, and the impact of AI on insurance coverage and claims. SRA Chairman Glen Riddell emphasized that AI presents both opportunities and challenges, necessitating a deeper understanding of its effects on reinsurance decisions.

The SRA conference concluded on November 5, addressing topics such as geopolitical shifts, disaster protection, and the evolving skills required in the face of technological advancements in the insurance industry.