Life Insurance Fuels Premium Growth Amid Elevated Interest Rates

Swiss Re Institute forecasts a steady rise in global insurance premiums, particularly driven by life insurance, which is expected to grow at 3% annually in 2025 and 2026. This growth is more than double the rate of the past decade, supported by high interest rates in key markets like the United States. Insurers' profitability is likely to benefit from the persistent elevated rates, contributing to a prosperous savings market.

Next year, a record surge in individual annuity sales is anticipated in the US, exceeding USD 400 billion, highlighted by a continued high demand in China's savings products. As central banks decrease rates, consumers may shift towards index-linked policies.

While life risk protection has seen modest growth, the demand for disability and long-term care insurance within Europe is robust. Non-life insurance could see profitability improvements despite slower premium growth rates.