Strong growth of 8.1% in 2024, the Greek market recorded insurancewith a total of € 5.7 billion premiums, according to its annual report Allianz Research for developments in the world market.
This marks that the insurance market has now left behind the difficult years of the euro crisis and has exceeded the levels recorded about 15 years ago, according to the Allianz Research annual “Global Insurance Report” report.
However, as noted, Greece remains the smallest market in the region, as Greek households spend less than all states, on insurance: Insurance penetration remains low, at 2.5%, compared to the regional average of 7.8%. All sectors have contributed to this strong growth: property and accident insurance (P&C) continued to increase at a rate of 9.6% and marginally higher than +9.2% of the previous year. Life insurance rose 6.6% (compared to +5.7% of 2023). With a share of about 9% of all premiums, health insurance remains much the smallest market sector.
World Market: Impressive growth
Regarding the global insurance market, according to the report, it is estimated that it was 8.6% growth in 2024, exceeding the already impressive 8.2% increase in the previous year. Insurance companies worldwide recorded € 557 billion premiums, raising the total amount of premiums to 7.0 trillion. euro. The Life Insurance Branch remained the largest sector, with € 2,902 billion income income, followed by property and accident insurance (P&C) with € 2,424 billion and health with € 1,682 billion.
Property and accident insurance (P&C) recorded the previous year +7.7%, slightly lower than +8.3%in 2023. It is worth noting that growth is mainly due to the larger market, North America, where premiums increased by +8.2%. Over 50% of world premiums come from this area. While premiums in Western Europe increased by +6.0%, the Asian market has suffered more restrained dynamic, with growth of only +4.0%. Thus, the Asian market remains smaller than Western European.
Life insurance showed growth of 10.4% in 2024, surpassing both other sectors, recording a higher growth rate than 2023 (+8.2%). The main lever of this growth was once again North America, with a striking increase of +14.4%. As interest rates have reached new high levels, there was a strong demand for pension products. Higher interest rates also contributed to the increase in premiums in Western Europe (+7.1%).
In Asia, most markets were highly growing, pioneering China, recording a growth rate of 15.4%. Unlike US domination in the P&C sector, the world’s world market shares are divided equally, with Asia (including Japan and China) having more than one -third of total premiums.
Health insurance recorded an increase of 7.0%, with the demand remaining particularly strong, especially in Asia, where growth reached 12.6%. This reflects the low insurance penetration in the area (premiums as a percentage of GDP), which remains below 1% in all markets except Taiwan. Even more than in life insurance, demand is determined by the state of the public welfare system, namely the level and quality of public health care.
Geopolitical uncertainties and commercial tensions may burden the volume of insurance, due to the slowdown in economic growth, the decline of trade and the increase in credit and market risks. On the other hand, a “protection effect” is likely to occur as businesses are looking for more risk management solutions within this uncertain and full of environmental crises.
In the long run, financial fragmentation and weakening international cooperation, including sectors of climate change, cyber security or preparation for pandemics, could increase the cost of insurance of these risks.
Prospects: Increasing demand for protection
According to the report, prospects for Europe are more optimistic this year, especially for the property and accident insurance industry (P&C).
There are two main reasons:
Firstthe expected boom in defense and infrastructure investment is expected to have a positive effect on the insurance sector.
Secondfurther increase in natural disasters will lead to higher premiums. With only 2.5% insurance percentage, European households and businesses are currently spending relatively few to cover in this area, compared to 4.4% in the US, which was to change in the coming years.
As a result, there is an annual increase in premiums in European insurance P&C by 4.2%, ie an increase of 0.6 percentage points compared to the previous provision. On the contrary, for the US and Asia, forecasts for the P&C industry have been slightly revised downwards.
Overall, the global insurance market is expected to make an annual 5.3% annual rate in the next decade, slightly higher than world GDP. For Greece, the total annual increase is provided for +5.3% (nominal GDP: 3.3%). In the property and accident insurance industry (P&C), we expect an annual increase of +4.5% by 2035 (Greece: 3.9%). This sector is estimated to have strong growth rates in almost all markets, as the growing need for protection is a global phenomenon.
Allianz Research also holds positive expectations for the life industry, which can expect an annual increase of 5.0%, thanks to higher interest rates. Asia and China remain the main growth levers, due to the increased need for private welfare, in view of accelerated demographic aging (Greece: 3.9%).
The smaller sector, health insurance, is expected to remain the most dynamic, with an annual increase of 6.7% (Greece: 14.1%). Asia in particular still has a great deal of growth.
In absolute numbers, the global premium portfolio is expected to increase by € 5,319 billion in the next decade. Most of this increase will come from life insurance (EUR 2,055 billion). Above half of the extra premiums will come from Asia and China (1,071 billion euros), more than North America (€ 416 billion) and Western Europe (351 billion euros) together.
In the property and accident insurance industry (P&C), about 40% of the extra € 1,522 billion premiums will come from North America. In the health sector, additional € 1,743 billion premiums are expected, with most of the US market.
“Insurance remains an industry with growth prospects,” said Ludovic Sampran, Chief Economist of Allianz. “However,” he continued, “this growth is largely fueled by inaction at the policy level: the underlying adaptation leads to increasing damage due to climate change, while delayed reforms in pension systems require increased savings by individuals. In the long run, however, the private insurance industry cannot bear the role of the “workshop” of society on its own. Only through cooperation can we face the great challenges, double transition. “