Premium growth in Australia outstripped major insurance markets during and after the global financial crisis (GFC), a new report shows.

Australian total non-life premiums grew 7.1% last year, compared with a 2% drop in Britain and a 4.4% rise in the US, according to the Bank for International Settlements.

Local insurers also had the best investment return – 5% – among seven developed countries last year, and posted premium growth in 2008 and 2010 that outstripped counterparts in the US, UK, France, Germany, Japan and the Netherlands.

The bank says general insurers absorbed the GFC-driven drop in asset values “thanks to their ample capital buffers. At present these buffers are being replenished via growing insurance premiums, which rebounded in most markets during the past couple of years.”

It says insurers are exposed to interest rate risk, amplified by the limited supply of long-term investable assets.

Derivatives can provide a good hedge for this and insurers will benefit from reforms to reduce counterparty risk, the bank says.