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Property Insurance - Australia

Australia

The Property Insurance market market in Australia is projected to reach a market size (gross written premium) of AUD €13.28bn by 2024.
The average spending per capita in the Property Insurance market market is estimated to be AUD €0.50k in 2024.
With an expected annual growth rate (CAGR 2024-2029) of 6.88%, the gross written premium is anticipated to reach AUD €18.52bn by 2029.
When compared globally, the United States is expected to generate the highest gross written premium of €222.9bn in 2024.
The property insurance market in Australia is experiencing a surge in demand due to the increasing frequency of natural disasters.

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Analyst Opinion

The Property Insurance market in Australia is experiencing a significant shift in customer preferences, trends, and local special circumstances.

Customer preferences: Customers in Australia are increasingly seeking comprehensive property insurance coverage that not only protects their homes or businesses from traditional risks like fire and theft but also covers newer risks such as natural disasters and cyber threats. This shift in preferences is driven by the growing awareness of the need for robust insurance coverage in the face of evolving risks in the modern world.

Trends in the market: One prominent trend in the Australian Property Insurance market is the rise of usage-based insurance policies, where premiums are determined based on individual risk profiles and behaviors. This trend is fueled by advancements in technology that allow for the collection of real-time data, enabling insurance companies to offer more personalized and flexible coverage options to customers. Additionally, there is a noticeable increase in the adoption of digital channels for purchasing insurance policies and filing claims, reflecting a broader trend towards digitization in the industry.

Local special circumstances: Australia's geographical location makes it particularly vulnerable to natural disasters such as bushfires, floods, and storms. As a result, property insurance providers in the country are facing unique challenges in underwriting risks and managing claims associated with these events. The frequency and severity of natural disasters in Australia have necessitated a reevaluation of risk models and pricing strategies by insurance companies operating in the market.

Underlying macroeconomic factors: The overall economic stability and growth in Australia play a crucial role in shaping the Property Insurance market. As the economy continues to expand, there is a corresponding increase in property values and construction activity, driving the demand for insurance products. Moreover, regulatory developments and government initiatives aimed at enhancing consumer protection and promoting competition in the insurance sector are influencing the market dynamics in Australia.

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.