Swiss Re Institute: global insurance markets set to rebound in 2021
According to a November 2020 report by Swiss Re Institute, global insurance markets are set to rebound in 2021 with China leading recovery.
- Global insurance premiums are expected to grow by 3.4% in real terms in 2021, after contracting an estimated 1.4% in 2020.
- China will lead recovery with premiums up by an estimated 10% in non-life next year, and by 8.5% in life.
- Insurance recovery supported by heightened risk awareness driving demand and continued strong rate hardening.
World gross domestic product (GDP) is expected to contract by 4.1% in 2021. Swiss Re Institute’s latest sigma study, “Rebuilding better: global economic and insurance market outlook 2021/22“, predicts that recovery will be slow and uneven in 2021.
Global GDP is forecast to grow by 4.7% in 2021 in real terms, below the market expectation of 5.2% growth. In this context, the sigma study finds that, amid the economic shock inflicted by COVID-19, global insurance markets have been less severely impacted than expected in earlier forecasts.
Total premium volumes in 2020 are estimated to decline by 1.4% in real terms, less than the earlier anticipated 2.8% drop.
Premium growth is forecast to recover swiftly to 3.4% and 3.3% in 2021 and 2022 respectively, supported by continued rate hardening.