Recent predictions show that by the year 2020, the income from that region’s premiums will have doubled.
The results of a new study from the Economic Research Department at Munich Re have shown that by the year 2020, the insurance industry premiums income from the Asia-Pacific region will have doubled their current size.
Until that year, nearly half of the estimated additional worldwide primary premiums will come from that region.
This equates to approximately €1 trillion, which will be generated by the Asia-Pacific insurance industry. The report on the findings said that approximately 70 percent of those premiums will come from “emerging Asia”. That includes both India and China. The primary premiums for property and casualty coverage within the Chinese and Indian markets are already growing at an average annual rate of 11 percent, said Munich Re.
The report also identified India, China, and Indonesia as the leading three areas of insurance industry growth.
According to the chief economist at Munich Re, Michael Menhart, “China, India and Indonesia will be the top-three growth countries in P&C, with average growth of above 12% over the forecast period (2012-2020) in China and India, and almost 10% in Indonesia.” The primary property and casualty volume from Indonesia is expected to more than double its 2012 size by the year 2020, until it will have reached €7.3 billion, said the report.
Munich Re pointed out that “Average growth rates of other emerging countries such as Vietnam, the Philippines, Malaysia and Thailand range between 6% and 8%.” The company explained that this insurance industry trend is driven by the growing awareness of risk that is spreading throughout those countries, as well as the rise of a middle class within their populations.
The increase in consumer savings is also playing an important role in the insurance industry in those areas, as the demand for both health and life coverage have been steadily on the rise. This has only been fueled by the changing regulations within those nations, as well as the improvements to consumer protection. It is expected that those trends will also lead to rising liability and auto coverage demand.