Australian premium volume is likely to grow an average 3% a year for the next decade, slightly above overall economic growth, according to Swiss Re Chief Economist Kurt Karl.

He says economic growth in Australia remains better than in many other regions, where insurers faced with low interest rates and weak growth have maintained profits on fewer disasters.

“There has been difficulty not only in getting pricing increases but also premium volume growth,” he told insuranceNEWS.com.au.

Swiss Re forecasts improved global economic activity into next year, “which will be good for premium growth but not a huge step up”.

Although the industry faces a huge amount of regulatory change, Dr Karl says Australia is experiencing “short-run pain but long-term gain” from better-regulated and risk-based capital. He says new global solvency standards will improve risk management and make the industry more sustainable.