Global insurance premiums forecast to grow despite economic slowdown
Source: Middle East Insurance Review | Aug 2023
Global insurance premiums (non-life and life) are forecast to grow by 1.1% in 2023 and by 1.7% in 2024 despite economic slowdown, according to Swiss Re Institute’s latest Sigma report.
With the reopening of China’s economy this year leading to a recovery in demand, Swiss Re forecasts emerging Asia to grow by 5.4% in 2023/24 and lead the global growth. Inflation remains the top global macroeconomic concern.
“With inflation pressures still persistent, hard market conditions in non-life business are set to continue as insurers offset elevated claims costs with higher premium prices. Once disinflation takes hold with prices decreasing, less expensive claims and greater returns from interest rate-sensitive investments should further support industry profitability,” said Swiss Re group chief economist, Jérôme Haegeli.
Swiss Re’s global economic growth forecasts are below consensus at 2.3% this year and 2.3% in 2024. The cumulative effect of over 18 months of rising interest rates, deteriorating credit conditions and further central balance sheet reductions will continue to dampen growth prospects. The risks to growth remain skewed to the downside.
The global insurance industry is expected to demonstrate continued resilience over the next two years. According to the report, global non-life and life insurance premiums are estimated to grow by 1.1% in 2023 and by 1.7% in 2024. Premium volumes are expected to total a new peak of $7.1tn in 2023, compared to $6.8tn in 2022. M