Bermudian life reinsurer Scottish Re is expanding its presence in Asia. The firm has received a licence to write business in Singapore, and approval to set up a representative office in Japan.
The company has had a representative office in Singapore since October last year, but was granted regulatory approval to upgrade this to a full branch office on March 7. It got approval to open a representative office in Tokyo, Japan on the same day.
Andrew Linfoot, regional director of Scottish Re’s Asia-Pacific operation and principal officer of its Singapore hub office, says the life reinsurer will offer its usual range of products, but will focus on coverages where it considers itself a market leader, such as securitizations.
“We’ll also be helping life insurers fund the underwriting and acquisition costs of their new business by advancing them future profits through quota-share reinsurance arrangements,” says Linfoot.
But Saul Martinez, equity research analyst at investment bank Bear Stearns, points out that, while the completion of the two- to four-month licensing process is an important step for Scottish Re, it will take time for the company to build a presence in the region.
“It makes sense from a strategic standpoint,” says Martinez. “Cession rates in Asia, which are the portion of premiums currently being reinsured, are very low so there are growth opportunities there. But it will take long time for this to move the needle and affect Scottish Re’s stock price.”
He adds that some of the company’s rivals, such as Reinsurance Group of America and Swiss Re, have maintained a firm foothold in the region for some time, and have offices in many more countries.
In addition to building Scottish Re’s infrastructure in Asia, Linfoot has hired six staff to assist him. He aims to have 12 staff in the Singapore office by the end of the year.
Linfoot has also hired a leader for Scottish Re’s new Tokyo office. He declined to say who this was, but said the executive would be in place by April 1.
Before joining Scottish Re on July 1, Linfoot served as principal officer of life reinsurer Revios‘s Singapore branch office for three years. Before that he spent seven years at Gerling Global Re, from which Revios was formed.
