Insurers face shift from coverage to adequacy

About 53% of residents see insurance as supporting financial independence.

Singapore insurers should focus less on expanding coverage and more on whether policies provide enough protection as customers increasingly plan for retirement, building wealth, and inheritance, according to Etiqa Insurance Pte. Ltd.

“Whilst many markets across Southeast Asia continue to focus on expanding insurance penetration and narrowing protection gaps, the challenge in Singapore is increasingly about adequacy, relevance, and ensuring that protection keeps pace with customers’ evolving needs,” Etiqa Insurance Singapore CEO Claudia Soh told Singapore Business Review.

Singapore’s insurance penetration stood at 7.6% of gross domestic product, according to the Allianz Global Insurance Report 2026 published in May. It ranked fourth among selected Asian markets, behind South Korea, Taiwan, and Hong Kong.

Soh said customers are increasingly considering insurance as part of longer-term financial planning rather than solely as protection against unexpected losses.

A May report by CIMB Bank Berhad, Singapore Branch found that 52.6% of Singapore residents viewed insurance as helping them achieve financial independence, up from 45% in 2025.

Customers are looking at how insurance could support retirement, building wealth, and passing it on to their families, as well as protecting pets and valuables, Soh said.

The shift requires insurers to show how their products support customers’ financial goals throughout different stages of their lives.

“The biggest risk is complacency,” Soh said in an emailed reply to questions. “The insurance industry has an important role to play in society, but we cannot take our relevance for granted.”

Artificial intelligence (AI) could help insurers better understand customers and tailor services to their needs, though human judgement and customer relationships remain important, she said.

“AI is an important enabler, but trust, human judgement, and meaningful customer relationships remain just as important,” Soh said.

She also cited Singapore’s rules for responsible data analytics and AI in financial services as an example of regulators working with the industry.

Etiqa sees growth opportunities in protection, building wealth, and retirement, though Soh did not disclose specific targets.