• According to the Allianz Global Insurance Report, the insurance industry got off relatively lightly during the Corona crisis: in 2020, global premium income fell by only 2.1%. Property insurance even recorded a small increase of 1.1%, while life business slumped by 4.1%. Overall, however, this decline was significantly steeper than in 2009 (-1.1%) in the aftermath of the financial crisis. Total premium income was thus around EUR 80bn lower than before the crisis, adding up to EUR 3,730bn (life: EUR 2,267bn and p&c: EUR 1,463bn).
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• Strong growth is expected for the insurance industry in 2021. Overall, premiums should rise by 5.1% globally. Unsurprisingly, the USA (+5.3%) and China (+13.4%) are likely to be the two growth engines. Following the sharp slump in the previous year, the recovery in the life segment (+5.7%) will be somewhat stronger than in the p&c segment (+4.2%). The strong growth should continue in subsequent years, driven by the increased focus on sustainability and the further rise of the emerging markets. Globally, average growth of over 5% over the next ten years appears possible. 
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The insurance industry proved resilient during the Corona crisis. However, this was the relatively easier part of the exercise. Because the crisis has massively increased the demands of our stakeholders. This affects not least our clients, who, fully digitized, are having new expectations on customer engagement. For the industry, this means a profound transformation, away from a pure product logic and toward a holistic service approach that focuses not on financial compensation but on the management and prevention of risks. This is the only way the industry can adequately benefit from the increased need for risk protection in the post-Corona world.

Western Europe recorded the sharpest drop in premiums worldwide in 2020, with a decline of 5.1%. While the property line just managed to hold its own (+0.5%), life revenues fell by 7.8%. Total premium income reached EUR 1,062bn, down just under EUR 60bn on the previous year. Recovery is also expected to be slower than in the rest of the world. While the global premium level is expected to return to pre-crisis levels by the end of 2021, this figure will probably not be reached in Europe until 2023. Reflecting the weaker economic development, growth of only 1.2% is expected in 2021 (life: 1.3%, p&c 1.1%). After that, however, an acceleration is also expected in Europe, with average growth over the next ten years expected to settle at 3% (life: 3.1%, non-life: 2.7%), well above the level of the last decade (1.2%), which was marred not only by Corona but also by the euro crisis.

Life insurance is the problem child of the European insurance industry. Over the past decade, growth here has been a meager 0.6% per year – it was four times higher in property insurance. Post Covid-19 presents a unique opportunity to reverse the trend. Not because a turnaround in interest rates is imminent, certainly not, but because European households are sitting on a mountain of additional savings amounting to almost EUR 500bn. If the industry succeeds in translating its expertise in sustainable investing into attractive products for its customers, it should be able to secure a slice of this pie.

In 2020, the German insurance market was one of the few developed markets in which premium income rose. Naturally, however, the increase was very modest at 0.8%. This positive development is primarily attributable to the property business, which grew by 2.1%. However, the decline in life business (-0.1%) was also significantly lower than in many other markets. Slightly stronger growth of 1.8% is expected in 2021 (life: 2%, non-life: 1.6%). Over the entire next decade, Germany is expected to achieve average growth of 2.7% per year. That would be slightly above the 2010’s level (+2.0%), as the life business should become again a little stronger in the coming years.