Premiums in the global reinsurance and insurance industries grew last year, according to a report from Aon Benfield. The report notes that insurance premiums reached an all-time high by the end of 2013. The Property and casualty, life, and health insurance sectors were the driving forces behind the growth in premiums. Overall, global premiums grew by 0.9% last year, reaching $4.9 trillion. Insurance premiums are likely to continue growing throughout the remainder of 2014.
Property casualty, life, and health insurance sectors see signifcant growth through 2013
In the property casualty sector, premiums grew by an average of 3.5%. Life insurance premiums actually shrunk by 2%, but still contributed to the overall growth of global premiums. The health insurance sector saw the most growth, with premiums increasing by 4.5%, reaching $3.3 trillion. The report notes that there are many opportunities emerging for the insurance industry as marketplaces around the world begin to evolve. Insurers are also seeing gains as they begin to tap into big data.
Big data is helping insurance companies reach higher levels of profitability
Big data is an all-encompassing term that identifies the collection of data that is so large that it cannot be processed using traditional means. Much of this data concerns consumer behavior and is sometimes used by insurance companies to develop new engagement strategies and products. For some in the insurance industry, big data has helped boost profitability. More insurance companies are beginning to embrace big data as a way to price their products for consumers.
Property casuralty sector likely to continue seeing strong growth, especially in the US and China
Aon predicts that premiums will continue to grow for the property casualty sector, especially where auto insurance is concerned. Auto insurance currently represents the largest segment of the property casualty sector, accounting for 47% of all direct written premiums. The U.S. is expected to remain the largest property casualty market in the world, representing some 37% of global property casualty premiums. China is expected to surpass Japan as the second largest market for this sector.
