Life insurance set to boom as interest rates surge, says Swiss Re Institute
- Higher interest rates boost profitability in life insurance industry, forecasts Swiss Re Institute.
- USD 1.5 trillion in global life savings premiums to be generated over next decade.
- Advanced markets to lead growth, with 61% from advanced markets and 39% from emerging markets.
Swiss Re Ltd / Key word(s): Research Update
Zurich, 27 May 2024 – Higher interest rates around the world are transforming the outlook for life insurance growth and profitability. Savings products are attractive to consumers after a decade of weak demand and low returns. Swiss Re Institute expects a new high for US fixed annuity sales this year after record sales in both 2022 and 2023. Jérôme Jean Haegeli, Swiss Re's Group Chief Economist, says: "Higher interest rates are a game changer, providing life insurance and pension products a tailwind to much better tackle the retirement savings challenges of ageing demographics. Savings products are attractive again as a direct consequence of normalising interest rates. Higher investment yields also benefit long-duration protection products." In its new sigma study, "Life insurance in the higher interest rate era: asset-savvy is the new asset-light", Swiss Re Institute forecasts an additional USD 1.5 trillion in global insurance savings premiums over the next decade, as consumers are moving to buy life-savings products that secure higher retirement incomes. As a result, total global premiums are forecast to grow to USD 4 trillion by 2034. In contrast, global life insurance premiums grew by only USD 300 billion in the entire low interest rate decade of 2010 to 2019. Diskutieren Sie über die enthaltenen Werte |