Skip to content

Global Premium income to grow by +67% or EUR2.8trn by 2032

Global Premium income

2023 was expected to be another bumper year for the insurance industry, but the invasion of Ukraine has dashed those hopes.

Premium income is likely to grow by roughly 1pp slower than originally assumed as the war takes its toll on economic activity and confidence, even as inflation supports the top line.

According to Allianz Global Insurance Report, global premium income to grow by +4.8% in 2023, with life and p&c developing almost in step (+4.9% and +4.6% respectively). This figure must be considered against the backdrop of a global inflation rate of 6.2% this year.

Despite the great uncertainties today, we are not too pessimistic about the more distant future. After all, these uncertainties are precisely the breeding ground for rising risk awareness; they reinforce the impact of the two megatrends of climate and demographic change, which will continue to be the main drivers of demand for risk protection.

Annual growth of +4.8% over the next 10 years (life: +4.9%; p&c: +4.6%). This corresponds to an increase in premium income by +67% or EUR2.8trn by 2032, of which just under EUR1.8trn will be generated by the life segment (+69%) and just over EUR1trn by the p&c segment (+63%).

The pandemic and the war in Ukraine are wake-up calls for better risk management, and even more demand for protection. The industry must succeed in maintaining its economic and social relevance, offering innovative solutions for new and rising risks.

The questions of insurability and affordability are likely to become increasingly urgent in the coming years. This requires a level of creativity and collaboration with all stakeholders, customers, carriers, and policy makers even beyond previous efforts.

Western Europe recorded an increase of 3.6% in total premium income in 2021 (life: 3.8%, P&C: 3.3%); total premium income exceeded EUR 1,1trn.

Reflecting the impact of the Ukraine war, growth is likely to decline to 2.9% in 2022 (life: 2.8%, p&c 3.1%). After that, however, an acceleration is also expected in Europe, with average growth over the next ten years expected to settle at 3.3% (life: 3.3%, non-life: 3.3%), well above the level of the last decade (1.6%), which was marred not only by Corona but also by the euro crisis.

Both lines of business might indirectly benefit from the recent crises. In the life business, increased risk awareness in the wake of the Covid 19 crisis and the inflation-triggered end of zero interest rates should make many savings and pension products more attractive again.

In the p&c business, climate-mitigation efforts will intensify, first and foremost the decarbonization of energy supply.

The quest for energy independence makes this even more important now. This requires major investments from both the private and public sectors and creates a high need for risk protection as new risks will emerge with this radical transformation of our economy.

by Yana Keller