The world insurance market, a slowing growth

Life premiums are the ones pulling the turnover down(-4.4%), while non-life insurance decreased by just 2.6%.

Evolution of life and non life insurance: 2005-2009*

Industrialized countries: a fall in premiums

Industrialized countries, which generate nearly 87% of the world contributions volume have posted a negative progression in their written premiums (-4.6%): the United States and the United Kingdom are the hardest hit, especially in life insurance, with respective decreases of 14.9% and 23.9% in nominal value.

Same trend in non-life business. Most industrialized countries (USA, UK, Japan, Italy) are exhibiting negative indicators: the fall is of 2.1% in the United States and 16.4% in the United Kingdom.

This decrease in premiums is accounted for by:

• the consequences of the financial crisis, which has continued to slow down growth,
• the depreciation of most currencies against the American dollar,
• the collapse in sales of savings and insurance products in unit of account,
• the uncertainty prevailing over financial markets.

Emerging markets: a substantial growth

In most emerging markets, mainly in Asia, insurance has continued its growth but at a slower pace. Premiums rose by 3.9% against 23.8% in 2008, that is, the poorest growth in 35 years. Despite this slowdown, the share of the emerging markets in the world premium volume has increased. It rose from 12% in 2008 to 13% in 2009.

Life insurance has been up by 4.9% against 23.9% a year earlier. Growth remained strong in South East Asia with an increase of 14%. Premiums have also increased in Latin America and the Caribbean (+4.3%) , whereas in Central and Eastern Europe they went down by 30%.

As for non-life insurance, growth has varied significantly from region to region. Premiums have increased by 14.8% in South East Asia and fallen significantly in Central and Eastern Europe (-7.8%).

For all of these markets, growth has been of 2.7% against 23.7% in 2008. This lack of dynamism is accounted for by a decline in marine and motor insurance.

Middle East: stagnation

After years of solid growth, the Middle East has exhibited deceiving results in 2009. Estimated at 3 billion USD, life premiums fell by 9% in comparison with the 27% increase in 2008. Large disparities have been noticed between the countries of this region. In Saudi Arabia, life and personal accident insurance has maintained a double-digit growth (+68%) in 2009, while in Oman, Jordan or Lebanon, the life and personal accident insurance premium volume has shrunk by respectively 4.6%, 2.2% and 20%.

Negatively impacted by the economic recession, non-life insurance has suffered a stagnation of its 2009 turnover which amounted to 24 billion USD, following a 20% rise in 2008.

Africa: a slight growth

The future of the African insurance market is promising despite the modest results achieved in 2009. Africa, whose share of the world insurance market remains minimal, at 1.2%, has collected 51 billion USD of premiums.

Life insurance has declined by 10% to reach 33 billion USD, whereas in 2008, it rose by almost 1%. The non-life class of business has grown by 1.1% compared to 5% in 2008. South Africa remains, by far the largest, market in the region accounting for over half of the non-life premiums and 90% of life premiums.

Evolution of premiums per zone: 2005-2009