According to analysis by AM Best the 10 ASEAN region economies are becoming an integral part of the global economy.

In a special report on South-East Asia, the ratings agency said the total gross domestic product last year from Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam was $2.31trn.

Insurers have benefited from the 10 economies over the last decade. Altogether ASEAN countries have grown their combined GDP 1.5 times the size of 2008 and three times that of 2003.

This GDP places ASEAN seventh in the world economically ahead of Brazil, Russia, Italy and India. Indonesia, Malasyia, the Philippines, Singapore, Thailand and Vietnam making up 95% of the area’s total GDP.

The insurance sector is benefiting from increased urbanisation, an expanding trade network and a growing middle class. However, political instability (for example the recent military coup in Thailand), regulation (for example the premium tax in the Philippines) and exchange-rate volatility are all risks for insurers’ growth prospects.

In addition, there are signs of economic deceleration in the region. GDP in Thailand for example decreased 2.1% in the first quarter of 2014.

By the end of next year the ASEAN region will be united in a common regional market, the ASEAN Economic Community. The idea of this new single market is based on the free flow of goods, services, investment, capital, and skilled labour among ASEAN member nations. –Andrew Tjaardstra,