Global insurance premiums to ‘recover to pre-COVID-19 crisis levels in 2021’

Written by Adam Cadle

10/07/2020

Global life insurance premiums are expected to contract by 6% in 2020 and non-life premiums by 0.1% due to the COVID-19 pandemic, Swiss Re has said, before volumes recover to pre-COVID-19 crisis levels in 2021.

The latest Swiss Re Institute’s sigma said the global life figure is after a reported growth of 2.2% in 2019 and the non-life figure is after a reported growth of 3.5% in 2019. “A main reason for the better showing in non-life is that the COVID-19 crisis has hit at a time of rate hardening in the sector, which has supported premium growth,” Swiss Re said.

Led by China, emerging markets are expected to underpin global market strength with total premiums up 1% this year and 7% in 2021. Swiss Re said that total premium volumes in advanced market (life and non-life) will shrink by 4% this year and return to positive growth of more than 2% in 2021.

"The insurance industry is showing resilience in face of the COVID-19-led economic downturn," Jerome Jean Haegeli, group chief economist at Swiss Re said.

"The magnitude of premium losses will be similar to that seen during the global financial crisis in 2008-09, even though this year's economic contraction of around 4% will be much more severe. Unlike for the global economy, we expect a strong V-shaped recovery in insurance premiums, a remarkable showing considering that the world is currently in the throes of the deepest recession ever".

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