Labuan International Business and Financial Centre Incorporated (Labuan IBFC Inc) has reported that its insurance industry increased profitability by 43.7% last year.
Profits grew to US $190.5 million in 2019 mainly due to improved underwriting performance and better cost management.
This was despite only modest top line growth, with total gross premiums at $1.5 billion, 89% of which originated from the Asian market.
Labuan IBFC is the second largest captive market in Asia with 52 captives operating in the Centre.
The Centre believes that Asian companies are increasingly embracing the use of captive as alternative risk management, and intends to continue tapping this potential with captive structures, supported by a pool of intermediaries and insurers.
New company incorporations in Labuan IBFC continued to grow albeit at a slower place with 981 new incorporations in 2019. Companies hailing from Far East continued to show positive trending over the last three years with a significant increase of 33.3% growth in 2019.
While 2019 had been a year of sustained growth for Labuan IBFC, it is wary of the challenges this year as global markets recoil from the impact of the COVID-19 pandemic and distressed oil prices.
Accordingly, the regulator has introduced a set of regulatory reliefs which provide administrative flexibilities and financial support to cushion the impact of the crisis and minimise disruption to business operations.
“Considering the uncertainties looming in the international business scene, Labuan FSA has been closely monitoring the situation and taken preemptive measures to maintain stability and sustainability of the industry,” Labuan IBFC said.
