|Title:||Global top 20 insurance markets ranked by premium volume for 2011, and increase/decrease forecast for 2021|
|Source:||National Underwriter Property & Casualty Insurance|
Start of full article - but without data
RANKING OF TOP XX MARKETS Globally
(by premium volume)
P&C RANK BY PREMIUMS 2011 2021 *
United States X X [arrow right] China X X [arrow up] Germany X X [arrow down] United Kingdom X X [arrow down] Japan X X [arrow down] Netherlands X X [arrow right] France X X [arrow down] South Korea XX X [arrow up] Italy X X [arrow down] Canada X XX [arrow down] Spain XX XX [arrow right] Brazil XX XX [arrow up] Australia XX XX [arrow down] Russia XX XX [arrow right] India XX XX [arrow up] Switzerland XX XX [arrow down] Turkey XX XX [arrow up] Belgium XX XX [arrow down] South Africa XX XX [arrow right] Mexico XX XX [arrow up]
Note: Arrows denote the direction of change in
ranking between 2011 and 2021. * Forecast
Source: Swiss Re Economic Research & Consulting
BURGEONING ECONOMIES in emerging markets overseas provide enticing opportunities for insurance companies, and some major carriers are aggressively seeking to bolster their global market share.
Despite the inherent challenges in doing business in foreign territories--including the chance of adverse political developments; competition from local insurers; the need for establishing distribution networks; and mostly low underwriting margins--the potential upside to international expansion is too great to be ignored.
Asia and Latin America have contributed the most to emerging-market premium growth in the past decade, driven both by their healthy economic environments and improvements in insurance regulations.
And this expansion is only expected to continue. Between now and 2021, more than half the growth of the global economy is expected to come from emerging markets, according to a 2011 Swiss Re report, "Insurance in Emerging Markets: Growth Drivers and Profitability."
P&C insurance premiums in emerging markets, the study says, are forecast to grow more than twice as quickly as those in industrialized nations.
As the middle class expands in a particular region, so does the potential to protect its assets. "Personal-lines demand, especially for auto insurance, which is our main business, is largely driven by the middle class," says Luis Bonell, president of Liberty Mutual Insurance's international country operations. "Overall, we see the middle class rising vigorously in most emerging markets."
And on the commercial side, coverage for manufacturers and for massive infrastructure projects is an important part of the equation in maximizing the insurance potential of growing economies.
Several carriers looking to make inroads in growing markets have identified Latin America as a prime target.
"Latin America is a key region, and we are seeing significant growth in Brazil in particular," says Hugh Burgess, CEO of the Americas region for Allianz Global Corporate & Specialty (AGCS), Allianz's global line for corporate and specialty insurance.
Two local AGCS offices are in the process of being set up: a headquarters in Rio de Janeiro and a location in Sao Paulo.
"Brazil is a 'must-be-there' market with an attractive client base of both local Brazilian enterprises and overseas companies," Burgess adds.
The Brazilian economy is forecast to grow nearly X percent in 2012 alone, including significant investments in large-scale infrastructure development.
The 2014 FIFA World Cup and upcoming Summer Olympics in 2016 are directly boosting the insurance market across all lines of business in the country. Additionally, with XX,XXX registered aircraft, Brazil is the world's fourth-largest domestic-aviation market.
"Growth in Latin America in particular has been very strong for us, driven by its growing economic importance to the world economy," adds Bonell. For example, he says, both within Venezuela and Brazil, Liberty Mutual takes in more than $X billion in net-written premium annually, including auto (personal and commercial); SME (small/medium enterprise) coverage in property, liability, life, marine and fleet; and individual/group life and health.
On the distribution front, Liberty International sells insurance products and services through two distinct approaches.
One way is through Liberty International Underwriters (LIU), which sells specialty commercial insurance worldwide. The other is through Liberty Mutual Insurance's international country operations that sell personal and small commercial-lines products to individuals and businesses via direct, institutional and affinity channels.
In January, XL Group received approval from the Brazilian insurance regulator, Superintendencia de Seguros Privados, to establish an insurance operation in the country. By spring, XL Seguros Brasil S.A. in Sao Paulo plans to offer a range of casualty, property, professional and specialty insurance products.
Bruno Laval, XL's regional manager for Iberia & Latin America, said in January that Brazil represented XX percent of South America's P&C insurance premiums in 2010, and forecasts show that Brazil's P&C market could reach $XXX billion by XXXX.
Gregory S. Hendrick, executive vice president and CEO of XL's insurance operations, tells NU, "As the large and middle-market companies we're focused on enter new markets and face different legislations and governance challenges--this is where we can help them move their world forward."
CHANGES IN CHINA, VALUE IN VIETNAM
The China Insurance Regulatory Commission has made significant changes to the business rules in the country in recent years, says Yvette Essen, director of industry research for Europe & emerging markets for A.M. Best-Europe. These include new rules established in 2010 that permit broader investment into assets including real estate projects and private companies.
The commission will also soon open the country's compulsory motor-insurance market to foreign insurers, but Essen warns this may lead to increased capacity and greater competition on rates. Both Allianz and AIG have expressed interest in trying for their slice of the private-auto pie.
XL says it has adopted a long-term commitment to China, having opened an insurance office there in March 2011. The following month, Shanghai-based XL Insurance (China) Co. began offering property, casualty, specialty and professional coverage.
Liberty International, too, has been able to capitalize on the robust economy in China, "where we are the second-largest foreign property & casualty company," says Bonell.
Growth for Liberty International has also come from a start-up operation in a country that borders China to the south: Vietnam.
Since it was liberalized four years ago, the Vietnamese insurance market has enjoyed rapid growth, with total direct-written premium increasing by approximately XX percent year-over-year, says A.M. Best's Essen.
Its P&C insurance market is expected to grow as the country's middle class expands and moves from bicycles to cars, fueling an increase in Motor Third Party Liability coverage.
As is the case with most Southeast Asian insurance markets, Essen notes, auto insurance is Vietnam's largest segment of the P&C sector--at XX percent of direct-written premium in 2010.