Find us on...
- Products & Services
- Sectors & Roles
- Report Store
- Contact Us
- Request a demo
Non-life insurance market shows remarkable signs of life
Globally, non-life insurance has shown remarkable resilience, recording continual growth even during the height of the financial crisis which engulfed most of the globe. By 2012, worldwide gross written premiums had increased by around $270bn when compared with 2008, the year the financial difficulties started.
The global non-life insurance market grew by 5% in 2012, to reach a value of $1,921.2bn, representing a compound annual growth rate of 3.8% for the period spanning 2008-2012.
Growth was fuelled by the Asia-Pacific region as Western economies struggled as car and house sales (normally major facilitators of the purchase of insurance premiums) declined or stagnated. Despite this, growth was still recorded in many Western nations as in many of these countries it is a requirement of law to possess auto and other forms of insurance such as public liability, furthermore in some Western countries a mortgage cannot be secured without possessing home insurance.
Asia-Pacific’s growth was led by China and India’s continued dynamic economic development. With auto insurance responsible for a majority of non-life insurance premiums in both countries, particularly in China since it became a requirement of law in 2006, this growth looks set to continue for the immediate future as increased disposable income leads to increased car sales.
Consumer power has improved in recent years as the advent of online comparison websites has created a far more competitive environment, particularly in Western countries, for non-life insurance companies. With customers now able to compare many company’s prices and level of coverage from the comfort of their home without the need to speak to respective sales people, and in a relatively short space of time, insurers are being forced to become more competitive on price.
Despite this potential threat to revenues, the fact that many forms of insurance are legal requirements in many countries offsets this issue. Furthermore, the potential to offer niche insurance such as musical instrument cover, classic car insurance, or travel insurance for the elderly, means companies can diversify if necessary.
Additionally, many insurance companies are part of diverse financial services companies which can bundle and cross sell non-life insurance with their other products, for example a company may offer cell phone or travel insurance for a monthly fee with their bank account. These factors would suggest that the non-life insurance market has the resilience to successfully navigate any future market disruptions.
For more, read our No-Life Insurance Market Reports.