The strong presence of European and US insurers in emerging nations is expected to drive the reinsurance industry. The gross premium of the global market is expected to reach an estimated US $304.4 billion in 2018 over the next five years (2013-2018).
Lucintel, a leading global Management Consulting and market research firm, has analyzed the global reinsurance industry and presents its findings in “Global Reinsurance Industry 2013-2018: Trend, Profit, and Forecast Analysis.”
The reinsurance industry comprises establishments whose business is to assume all or part of the risk associated with existing insurance policies originally underwritten by other insurance carriers. Enterprises engaged in this business collect fees, reinsurance premiums, or annuity considerations and invest premiums to build up a portfolio of financial assets to be used against future claims.
Lucintel’s research indicates that premium growth remained strong across Asian markets due to sustained growth in primary insurance supporting reinsurance growth and the increasing need for greater risk awareness.
Gross premium in ROW grew at substantially during 2007-2012 because of increasing primary insurance in the region. Greater awareness of the benefits of reinsurance followed encouragement from regulators with their growth-favoring policies. Demand for reinsurance in Middle East nations continued to grow with new entrants providing additional capacity in expanding non-life markets.
In the global reinsurance industry, life reinsurance witnessed the highest premium growth during the last five years due to increasing life insurance premium growth that supported the growth of life reinsurers and rising demand for longevity risk transfers. Demand for reinsurance solution is increasing as a means to manage the capital strain put on primary life and health insurers, resulting in growth of the industry.
As per Lucintel’s study, implementation of Solvency II standards in the European Union is expected to improve growth rates in forecast years, as they are anticipated to bring positive results for customers and insurers. Increased demand is expected to be driven by the need to seek capital relief under the guidelines.
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