Life insurance - Worldwide

Worldwide

The Life insurance market market worldwide is projected to reach a market size (gross written premium) of €3.26tn in 2024.
The average spending per capita in the Life insurance market market is expected to amount to €0.42k in the same year.
The gross written premium is projected to show an annual growth rate (CAGR 2024-2029) of 1.43%, resulting in a market volume of €3.50tn by 2029.
In global comparison, the United States is anticipated to generate the highest gross written premium, amounting to €1,182.0bn in 2024.
In recent years, the life insurance market in countries with high aging populations, such as Japan, has experienced significant growth due to increased demand for retirement planning and long-term financial security.

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Analyst Opinion

The Life insurance market is a dynamic industry with various trends and developments shaping its landscape across different countries and regions.

Customer preferences: Customers worldwide are increasingly seeking life insurance products that offer not only financial protection but also investment opportunities. They are looking for policies that provide a combination of security for their loved ones and potential for wealth accumulation. Additionally, there is a growing demand for customizable insurance plans that can be tailored to individual needs and preferences.

Trends in the market: In the United States, the life insurance market is witnessing a rise in the adoption of digital platforms for policy purchases and claims processing. Insurers are leveraging technology to enhance customer experience and streamline operations. Moreover, there is a noticeable trend towards wellness programs and incentives that promote healthy living among policyholders, ultimately leading to lower risks for insurance providers. In Asia, particularly in countries like Japan and South Korea, the market is experiencing a shift towards innovative product offerings such as hybrid policies that combine life insurance with elements of health and retirement planning. This trend is driven by an aging population and changing consumer expectations regarding financial security in later stages of life.

Local special circumstances: In Europe, regulatory changes such as the implementation of Solvency II have had a significant impact on the life insurance market. Insurers are required to hold higher levels of capital reserves, leading to a greater focus on risk management and investment strategies. Additionally, low interest rates in the region have prompted insurers to explore alternative investment options to generate returns and meet long-term obligations to policyholders.

Underlying macroeconomic factors: Global economic conditions, such as GDP growth, inflation rates, and interest rate movements, play a crucial role in shaping the life insurance market. Economic stability and growth often lead to an increase in disposable income and overall demand for insurance products. Conversely, economic downturns can impact consumer confidence and purchasing power, influencing the uptake of life insurance policies. Additionally, demographic trends, such as population aging and urbanization, also influence the market dynamics by affecting insurance penetration rates and product preferences.

Methodology

Data coverage:

Data encompasses B2B and B2C enterprises. Figures are based on gross written premium, gross written premium per capita, gross claim payments, loss ratio, and distribution channels.

Modeling approach / Market size:

Market sizes are determined by a Bottom-Up approach, based on a specific rationale for each market layer. As a basis for evaluating markets, we use industry associations, national statistic offices, and international organizations, such as OECD. Next we use relevant key market indicators and data from country-specific associations such as insurance consumer spending, gross domestic product, insurance - consumer price index (CPI), population growth. This data helps us to estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the particular market. For example, exponential trend smoothing and HOLT-linear. The main drivers are insurance consumer spending and insurance - consumer price index (CPI).

Additional Notes:

The market is updated twice per year in case market dynamics change. The impact of the COVID-19 pandemic is considered at a country-specific level.