Insurances - Worldwide

Worldwide

The Insurances market worldwide is projected to reach a market size of US$9.10tn in 2024.
In this market, Non-Life Insurances dominates with a projected market volume of US$5.42tn in the same year.
The average spending per capita in the Insurances market is expected to amount to US$1.17k in 2024.
When comparing the global market, it is evident that the United States holds the highest nominal value, with an estimated gross written premium of US$4,642.0bn in 2024.
Looking ahead, the gross written premium is anticipated to show an annual growth rate of 2.15% (CAGR 2024-2028), resulting in a market volume of US$9.91tn by 2028.
Once again, the United States is expected to generate the highest gross written premium, reaching US$4,642.0bn in 2024.

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Analyst Opinion

The insurance market is in a state of constant evolution, shaped by changing consumer expectations, emerging risks, and regulatory developments. As of the present, several key trends are driving the industry's transformation, while underlying indicators provide insights into its health and performance.

Trends on the market:

Digital Transformation: The insurance industry is experiencing a profound digital shift, leveraging technologies such as AI, machine learning, and blockchain to enhance operational efficiency, improve customer experiences, and introduce innovative products.
Data Analytics and Personalization: Insurers are increasingly harnessing big data and analytics to gain deeper insights into customer behavior and risk profiles. This enables them to tailor insurance policies and pricing, fostering stronger customer engagement and reducing underwriting risk.
Sustainability and ESG Considerations: Environmental, Social, and Governance (ESG) factors are gaining prominence in the insurance landscape. Insurers are integrating sustainability principles into their underwriting and investment strategies, aligning with the broader societal move toward responsible and environmentally conscious practices.
Life and Health Insurance Innovation: In the wake of the COVID-19 pandemic, there is a heightened focus on life and health insurance, with innovative products addressing pandemic-related risks and health protection becoming more prominent.
Regulatory Changes: Evolving regulatory landscapes continue to influence the insurance market, with trends in data privacy, consumer protection, and climate-related regulations impacting how insurers operate and design their product offerings.

Underlying Indicators:

Uncertainties in the Current Economy and International Affairs: The state of the global economy and international affairs can introduce significant uncertainties for insurers. These uncertainties can impact investment performance, underwriting risk, and the overall stability of the insurance market.
Interest Rates: Prevailing interest rates significantly impact insurers' investment income, profitability, and pricing strategies. A low-interest-rate environment can challenge insurers' ability to generate returns on their investments.
Customer Demographics: Changes in demographics, such as an aging population or shifts in income distribution, shape the demand for various insurance policies. Understanding these demographic trends assists insurers in tailoring their offerings.
Investment Performance: The performance of insurers' investment portfolios, encompassing stocks, bonds, and real estate, plays a vital role in their financial stability and capacity to meet claims.
Catastrophic Events: Natural disasters and large-scale events, including pandemics, can result in substantial insurance claims, significantly affecting the industry's financial stability. Continuously monitoring these events and their frequency is essential for risk assessment and pricing strategies.

Methodology

Data coverage:

Data encompasses B2B and B2C enterprises. Figures are based on gross written premium, gross written premium per capita, gross claim payments, loss ratio, and distribution channels.

Modeling approach / Market size:

Market sizes are determined by a Bottom-Up approach, based on a specific rationale for each market layer. As a basis for evaluating markets, we use industry associations, national statistic offices, and international organizations, such as OECD. Next we use relevant key market indicators and data from country-specific associations such as insurance consumer spending, gross domestic product, insurance - consumer price index (CPI), population growth. This data helps us to estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the particular market. For example, exponential trend smoothing and HOLT-linear. The main drivers are insurance consumer spending and insurance - consumer price index (CPI).

Additional Notes:

The market is updated twice per year in case market dynamics change. The impact of the COVID-19 pandemic is considered at a country-specific level.