Swiss Re & the Hard Market — Look for it to Ease in 2025

On a global scope, Swiss Re thinks the hard market conditions in commercial and personal lines will ease up in 2025. Leading the way will be a softening of inflation and claims inflation.

The report is called World insurance: strengthening global resilience with a new lease of life. It says non-life premiums grew by 3.9% in 2023. That’s up 0.8% from the year before.

Profitability is also on the upswing. There was a 6% overall profit in 2023 because of better underwriting results and good return on investments.

The report predicts that non-life insurers’ return on equity will go up by 10% this year and 10.7% next. We’ll also see better underwriting results and investment results.

“We see underwriting results turning positive, supported by high premium rates, rising exposures and easing claims growth as inflation moderates. Investment returns will continue to benefit from the higher interest rates, while the cost of capital will remain broadly stable,” the report said.

One final note. There was a commentary accompanying the report.

“An insurance sector in healthy earnings mode will attract more capital,” the commentary said. “This, in turn, will drive industry growth and expand risk transfer capacity, enabling the industry to contribute more to narrowing existing protection gaps in many parts of the world.”

Source link: Insurance Journal — https://bit.ly/4cTiMT5