Swiss Re Bullish On Emerging Markets

NU Online News Service, Oct. 8, 12:32 p.m. EDT?Swiss Reinsurance Company, in a new study, is forecasting a doubling of property-casualty premiums in emerging markets in the next 10 years, from $123 billion as of last year to some $250 billion by 2014.[@@]

The Swiss Re study offered bullish commentaries on emerging markets?including China, Russia and India?calling them the "frontier of insurance in the future."

"Impressive growth prospects for emerging markets are putting them at the frontier of insurance," according to Clarence Wong, who leads the Economic Research and Consulting Asia unit of Swiss Re.

Swiss Re, based in Zurich, Switzerland, said non-life insurance premiums in emerging markets have risen annually by 7.3 percent in real terms during the last 10 years. In comparison, industrialized nations had posted annual premium growth of only 2.6 percent on average during the past decade.

Swiss Re forecasted that premium growth in emerging markets would remain strong, at 7.5 percent per year, during the next decade?thanks to robust economic growth, increased stability, and favorable regulatory developments, as well as new product offerings and distribution channels.

Among emerging markets, Mr. Wong said, China and India offer particularly encouraging prospects because of their large populations, growing economic importance and fast-liberalizing regulatory structures.

With their robust economic development, their insurance markets have also grown spectacularly, Swiss Re observed. In China, for example, non-life premiums have risen by an annual average of 10.8 percent over the last decade. In India, the average annual growth rate for non-life insurance was 6.2 percent during that same period.

The Swiss Re study did acknowledge that, so far, China and India markets are fairly small in the global scale, accounting for only 2.2 percent of worldwide insurance premiums in total. Still, the study forecast, these countries' fast-growing economies and population sizes?in addition to rapid industrialization and globalization?should create ample opportunities for further expansion in their insurance markets.

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Swiss Re Bullish On Emerging Markets

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