From Artemis:
Global reinsurance company Swiss Re forecasted that global premium growth is going to continue, as the need for insurance continues to grow, alongside heightened risk awareness, while client needs evolve at the same time.
Swiss Re forecasts that non-life insurance premiums will have grown 10% above their pre-COVID-19 level by the end of 2021, with continued increases predicted for 2022 and beyond.
All of which suggests a growing need for more risk capital, across insurance and reinsurance markets, highlighting the need for the industry to embrace efficient forms of funding, including insurance-linked securities (ILS) and third-party reinsurance capital partnerships.
“Heightened risk trends will increase the need for insurance protection, but also require a greater focus on evaluating and modelling, and ensuring pricing is adequate for the risks taken,” Swiss Re said this morning.
With underwriting results the main focus for an industry that continues to suffer the effects of a low investment yield world, expanding capabilities in technology and data are expected to be vital.
Swiss Re’s Chief Executive Officer Reinsurance Moses Ojeisekhoba explained, ”There is a clear recognition that claims’ frequency and severity is rising as demonstrated by recent natural catastrophes or cyber incidents. This means the need for protection is growing, and the industry has important work to do in offering insurance and closing the protection gap. Swiss Re’s extensive risk knowledge and very strong capital position allow us to support our clients in their growth ambitions.”
Climate change is the biggest long-term threat to the global economy, Swiss Re explained, which means there is an increased need for protection.
But with risks rising Swiss Re warns of the need to price risks adequately, but adds that all this means there is a positive outlook for premiums as these will need to reflect the increased exposures.
Climate change is a real threat, but it is also the biggest growth opportunity in insurance and reinsurance, Swiss Re also said today.
Here the reinsurance firm is really referring to the investment side, as “investments in the order of USD 6.9 trillion a year will be required.”
But this is also going be one of the biggest growth opportunities on the underwriting side as well, as both risk and investment related to climate change and resilience need to be protected and financially hedged....
....MUCH MORE
