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Emerging Asia is likely to be the engine of growth for the world economy in the coming years. With the China’s economy reopening again this year, Emerging Asia to grow by 5.4% in 2023/24 due to recovery in demand. However, inflation still remains the biggest global macroeconomic concern, inducing hard market conditions in non-life business prompting insurers to offset elevated claims costs with higher premium prices.
As per an estimate, global economic growth will be lower at 2.3% this year and 2.3% in 2024. This growth is majorly contributed by emerging Asian markets, wherein countries like India, Thailand, Indonesia and Malaysia are likely to grow much higher. With China coming out of the lockdowns in December last year, it is forecasted to register stronger growth this year than in 2022, pegged at 5.4%.
Insurance industry’s profitability in the world is set to improve with global insurance premiums, both in non-life and life, are estimated to grow by 1.1% in 2023 and by 1.7% in 2024. The premium amounts are forecasted to touch a new peak of $7.1 Tn in 2023, as compared to $6.8 Tn in 2022.
The Non-life premiums in emerging Asia are estimated to expand by 6.7% and 6.2% over 2023 and 2024, whereas life premiums are set to grow by 5.0% and 5.4%.
This year Non-life business is likely to be supported by better pricing, with Non-life premiums for China and emerging Asia forecasted to grow by 6.8% and 6.6% respectively.