Property & Casualty (P&C) underwriting profitability is unlikely to sustain the growth rates seen last year, a new report from Swiss Re says. 

Insurers in Australia and Canada reported strong P&C underwriting results in 2022, and Swiss Re’s World Insurance: Shaken not stirred report forecasts “a reversion to mean performance in the coming years”. 

“While most key insurance countries will improve, Australia and Canada performance will ease to more normal levels,” the report said.  

Last year, Australia was the 14th largest insurance market by nominal premium volume, at $US72 billion ($105 billion), or 1.1% of the global market.  

India is one of the fastest growing insurance markets in the world, and Swiss Re forecasts it will be the sixth largest by 2032 – ahead of Germany. Asian markets made up 8 of the top 20, with a 24% market share in 2022.  

Swiss Re says sound capital positions mean insurers have “not been shaken by the disruptions in the financial system”.  

“If anything, we expect the industry to demonstrate resilience over the next two years,” it said, forecasting global insurance premiums will grow by 1.1% this year and 1.7% in 2024 in real terms, after contracting by 1.1% in 2022.  

"Reflecting the stirrings of market growth, we see premium volumes rising to a new high this year, in nominal terms,” it said. 

In non-life, the main driver of the growth will be market hardening in commercial and, more recently, personal lines, with insurers raising premium prices to offset inflation-induced rising claims costs. Motor was forecast to return to growth after three years of contraction. 

"Hard market conditions in non‑life are set to continue as insurers offset elevated claims costs with higher premium prices,” Swiss Re's Group Chief Economist Jerome Haegeli said. 

“Once disinflation takes hold with prices decreasing, less expensive claims and greater returns from interest‑rate‑sensitive investments should further support industry profitability.” 

See the report here.