Swiss Re: Asian insurance markets to outgrow global markets in 2023

Non-life premiums across emerging Asia – excluding China – will expand by 6.6 percent in real terms over the course of 2023, while advanced Asia is set for an uptick of 1.4 percent for the same period, according to Swiss Re.

Swiss Re’s latest Sigma report said both emerging and advanced Asian markets are set to outperform their respective categories in 2023.

Emerging Asia’s real-term premium growth is expected to have marginally improved from the 6 percent growth in 2022, and stay ahead of the average annual growth between 2012 and 2021 of 6.3 percent.

The broader emerging market is estimated to grow by 4.5 percent in 2023, falling short of the 2012 to 2021 annual average of 7.1 percent.

China’s market is expected to lead the way with estimated non-life premium growth of 6.8 percent, but the Latin American market’s growth looks set to slow to 0.9 percent and emerging EMEA markets are expected to be largely flat across 2023.

Advanced Asia’s uptick of 1.4 percent was said to be a result of China’s reopening and market hardening.

It is expected to outperform advanced EMEA and North America, which are both set to grow between 0.7-0.8 percent.

Non-life Asia Pacific insurers also saw better performance relative to main stock indices than their US, UK, and European counterparts.

Swiss Re noted that compared to the US, UK, Germany and Italy, Japanese insurers had a smaller gap to target return on equity in 2022, with no expectation of significant narrowing in 2023.

Asian insurers hold 24% global market share

Asian countries represented eight of the 20 largest insurance markets in the world in 2022, although the US continued to dominate market share (43.7 percent).

The Asian markets’ overall market share was 24 percent in 2022, with the second-largest market share held by China at 10.3 percent.

Asia’s second- and third-largest markets were Japan and South Korea, which held market shares of 5 percent and 2.7 percent respectively.

Both saw a slight drop in market share compared to their 2021 figures, with Japan slipping down to fourth in the rankings after a 0.9 percentage point drop in its market share.

It was replaced in third by the UK insurance market, which itself saw a 0.1 point drop in market share to 5.4 percent.

South Korea maintained its seventh position with a 0.2 point market share drop.

Swiss Re highlighted the Indian market, currently eleventh, as one it expected to grow significantly.

It said that by 2032 the Indian market is likely to leap ahead of Germany, Canada and South Korea to become the world’s sixth-largest insurance market.

“Our outlook is based on expectations of strong economic growth, rising levels of disposable income, India’s young population, increased risk awareness and also digital penetration, and regulatory developments,” explained Swiss Re.