Emerging Asia Life Insurance Pulse 2019 offers an overview of the current state and future prospects of the region’s life insurance markets.
With a combined premium volume of US$ 448 billion, the region represents about 17 per cent of the global life insurance market.
This study draws on in-depth interviews with senior executives of 29 national, regional and international (re)insurance companies and intermediaries, based in eight different markets including China, India, Pakistan and South East Asia.
Its findings suggests a buoyant outlook for risk protection products that mitigate exposure to the rise of morbidity risks such as cancer, diabetes and cardiovascular diseases which constitute the region’s single most important life and health protection gap.
Emerging Asia’s rapidly expanding middle classes are seen by the executives polled as the most attractive feature of the region’s life and health insurance markets.
Among the wealthier parts of the population there is an increasing awareness of the need to cover biometric risks (mortality and morbidity) prior to retirement in order to protect income and dependent family members.
In addition, middle classes demand healthcare services which increasingly go beyond the level offered by existing public schemes.
The second most frequently mentioned market strength is general economic growth.
As GDP per capita increases more people have excess income available to buy protection and savings products.
As soon as GDP per capita exceeds a certain threshold life and health premiums tend to grow at a much faster pace than GDP in general, before levelling off in wealthier mature markets.
Third, technological savvy is mentioned as a relevant strength underpinning the profitable growth of the region’s life and health insurance markets.
Smart and mobile phone penetration, for example, is very high even in countries with still low levels of disposable income.
In addition, the propensity to transact online is viewed as higher than in other parts of the world.
Against this backdrop, life and health insurers operate on a fertile ground for product and distribution innovation.