Global Life Insurance Market Status: Future of Asia Pacific and US Market

As insurance business proceeded to extend and charges develop, insurance agencies likewise encountered an expansion in their gross claim payments in 2019. Net claim payments expanded in the existing area of most revealing nations (33 out of 49 reported by OECD).

The 6 biggest expansions in claims were recorded in Russia (80.2%), France (73.3%), Latvia (56.9%), and Finland (53.5%). Net cases installments additionally expanded by over 20% in three different nations: El Salvador (34.6%), Iceland (33.2%), and Costa Rica (29.4%)

On account of Russia, the huge expansion in claims payments, up by over 80% in 2019, was because of an increment in maturing contracts. Various 3-and 5-year life insurance contracts arrived at their terms in 2019. The Central Bank of Russia expects a pinnacle of installments for 3-year investment life insurance contracts in 2020 as expenses paid for these sorts of agreements were the most elevated in 2017.

Asia-Pacific Life Insurance Market to reach USD 1.5 Trillion by 2023

The life insurance written premium in the Asia-Pacific region is projected to grow from USD 1.2 trillion in 2019 to USD 1.5 trillion in 2023, according to the "Global Life Insurance Market to 2023" report. The insurance market research report reveals that life insurance in the Asia-Pacific region will grow at a compound annual growth rate (CAGR) of 4.9% during 2019–2023, supported by aging population and an expanding middle-class population with a growing disposable income.

Despite the disruption due to the COVID-19 pandemic, several countries are now seeing gradual recovery following the lifting of lockdown restrictions. In Singapore, positive economic activity from Q3 2020 aided in recovery in demand for life insurance products. Similarly in Hong Kong, total premiums of long-term in-force policies increased by 5.1% year-on-year during the first three quarters of 2020.

To drive sales, several life insurers are offering COVID-19 specific riders which provide diagnosis and death benefits. The Life Insurance Association of Malaysia extended additional relief measures such as cash benefits and lump-sum death benefits for policyholders diagnosed with COVID-19. This, coupled with the pandemic-led awareness, is expected to increase demand for life insurance policies.

Technology advancements are another area that has gained more prominence. Due to the social distancing norms and regulatory push, an increasing number of insurers are shifting to digital platforms. In June 2020, Manulife Hong Kong launched a virtual face-to-face agency sales platform for most of its insurance product offerings.

Large insurers are also collaborating with startups and insurtech companies to remain competitive and enhance the customer experience. For instance, Manulife-Sinochem Life introduced the biological age model (BAM)+ life insurance. The company collaborated with insurtech firm SCOR Global Life and ReMark to add the BAM algorithm, which helps insurers in continuous risk assessment thereby facilitating better underwriting and competitive pricing.

The life insurance market will continue to grow, driven by the greater deployment of technology and an increase in demand. Low insurance penetration in emerging markets will drive demand for protection insurance while the aging demography in mature markets will create demand for post-retirement insurance products.

US Life Insurance after Coronavirus (COVID-19)

The life and health insurance sectors are expected to be more strained than property and casualty carriers in the US due to the nature of the country’s healthcare system. The main reason for this is that life and health policies do not contain pandemic exclusions, while policies such as business interruption and cancellation insurance generally do. Furthermore, for health insurers, relaxation in co-payment and other treatment costs will add massively to the claims cost and could completely wipe out insurers’ 2020 earnings, based on the projected maximum infection rate.

The US life insurance market had total gross written premiums of USD 593.4 billion in 2018, representing a compound annual growth rate (CAGR) of 2.8% between 2014 and 2018. The US life insurance market in 2024, following the impact of COVID-19, is now expected to grow at a compound annual growth rate (CAGR) of 2.7%, down from 3.3%. The most significant drop in growth will be in 2020, with GWP growth falling from 3.2% to 1.9%. Declining GWP growth will not be the insurers’ major concern, however, with claims set to rise significantly in this sector, in 2020 especially.

New requirements have already been announced. Insurers are imposing a waiting period on customers wanting to travel abroad, while people who survived the virus will face premium price hikes. This coupled with the new conditional stipulation on the sale of term life plans without medical tests, is going to weigh down the short-term growth prospects of the industry.

However, the industry is going to register development on pandemic covers. Cover of infectious diseases for companies enjoyed limited exposure previously, but Marsh has already reported a spike in interest. This will be an opportunity for long-term growth for insurers after the short-term impact has worn off.

5 largest Life Insurance Companies in the US

Global Insurance Market report provides insight into key technological developments impacting the Global Life Insurance industry, detailed analysis of the competitive landscape, overview, and comparative analysis of leading companies and top insurance markets' premium and profitability trends for every region. Report in a nutshell offers modeling, and analysis expertise, giving insurers access to information on life insurance dynamics in the country.

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