Digital Transformation and Risk Mitigation in Emerging Insurance Markets: A Comparative Analysis Between China and Serbia

Radosavljević, Katica (2023) Digital Transformation and Risk Mitigation in Emerging Insurance Markets: A Comparative Analysis Between China and Serbia. Opportunities and Challenges in Sustainability, 2 (2). pp. 104-115. ISSN 2957-7217

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Abstract

Recent trends indicate a deceleration in the growth of insurance markets in developed countries, whereas emerging insurance markets, predominantly in Southeast Asia, and led by China, demonstrate a remarkable increase in total gross premiums. This contrast, largely attributed to digitalization of insurance operations, underscores the need for understanding and integrating technological innovations within the insurance industry. Faced with emerging risks such as climate change, natural disasters, epidemics, pandemics, and cyber threats, insurance companies must implement proactive risk prevention strategies alongside enhancing their risk mitigation instruments. Utilizing comprehensive, country-specific alert systems can aid in evaluating risk profiles and managing the emergent risks more efficiently. While Serbia's efforts towards digital transformation in the insurance sector are still budding, there remains a significant potential for growth and introduction of innovative insurance products. However, the lack of adequate preventive measures against risks such as natural disasters has hampered its full development potential in sectors like agriculture and tourism. On the other hand, China's approach to managing natural disaster risks through robust institutional support and an innovative insurance market offers valuable insights. This study aims to highlight the significant challenges posed by modern trends in the insurance industry, emphasizing the case of China, and suggesting ways for insurance companies to respond to these challenges. Moreover, it assesses the readiness of the Serbian insurance market in managing natural disaster risks and provides a roadmap for the integration of technology within the insurance sector.

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