Hong Kong-based global reinsurer Peak Re says policy wordings in the Asia-Pacific region have been clearer on pandemic wordings due to more experience with contagious diseases.

“When you look at COVID-19, this part of the world is going through its fifth epidemic this century, and this century is only 20 years old,” CEO Franz-Josef Hahn said.

Experience with previous outbreaks such as SARS, MERS and swine flu has resulted in fewer problems on the wordings side in respect of pandemics in Asia compared to in Europe, he says.

Mr Hahn, speaking during an Aon reinsurance renewal season virtual fireside chat, also says firms are likely to see the January 1 period as a chance to “correct pricing” to ensure a sustainable marketplace.

On cyber insurance, Mr Hahn says Peak Re is committed to provide cover but is taking a cautious approach, particularly given inadequate resources allocated by many smaller firms to deal with their exposures.

“This industry needs to develop affordable risk management as a service to the [SME] market to create a better basis for the insurability of cyber risk, at least to a certain extent,” he said.

Future risks likely to present challenges include water shortages, which are likely to become a key driver of global conflict, he says.