Asia: Region's insurance markets to rebound this year from a slow 2018
Source: Asia Insurance Review | Jul 2019
Asia’s insurance markets (ex Japan) are expected to rebound this year, with premium growth forecast at almost 11%, according to Allianz Research.
In contrast, 2018 was an unusual year for Asia as premiums rose by a meagre 2.3% in the region (ex Japan), only the second time since the turn of the millennium that it trailed behind global growth of 3.3%. Moreover, with an increase of 4.0%, even Japan grew faster last year, says Allianz Research.
In 2018, Asia accounted for only 16% of global growth (after 81% in 2017). Explaining this dismal performance are the life markets both in China and Korea - which account together for 40% of the total regional premium pool (ex Japan). The two markets shrank in 2018. In China, this was mainly due to a regulatory crackdown on the sale of short and medium term wealth management products.
“2018 does not mark the end of the Asian growth story,” commented Allianz Research economist Michaela Grimm. “On the contrary. The stricter oversight in China is more than welcome, signalling the next phase of a more balanced and sustainable development. Coupled with the breathtaking technological progress in the market - it is the clear frontrunner in the application of AI or innovative payment solutions - China is the market to watch. It’s the best place to learn about the future of our industry. ‘Sold in China’ is the new gold standard in insurance.”
Allianz Research expects the region to achieve growth of 9.4% pa over the next decade. All in all, around 60% of additional premiums worldwide will be generated in Asia (ex Japan). A