NU Online News Service, June 29, 2:44 p.m. EDT
Non-life insurance business was not heavily affected by the global recession as premiums remained relatively flat at $1.74 billion in 2009 compared to 2008, according to a Swiss Re sigma report on world insurance premiums.
An expected increase in interest rates is needed to "bring the primary non-life insurance industry back to adequate profitability levels," said Daniel Staid, Swiss Re economist and one of the authors of the study, which is based on 159 insurance markets.
Competition in the industry will make it "difficult to improve profitability significantly," he said.
There have already been some costly natural catastrophes in 2010, Mr. Staid added.
Lower prices may have dampened profitability in the non-life segment in 2009, but "there was an improvement compared to 2008 due to the recovery of credit and equity markets," said Mr. Staib.
Premiums for non-life coverages dropped in the United States, United Kingdom and Japan but increased in emerging markets, such as China, which saw a 19 percent growth in premiums.
Life premiums fell 2 percent in 2009, Swiss Re said.
The global reinsurer predicts an increase in premiums for all coverages as the global economy improves.
© Arc, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to TMSalesOperations@arc-network.com. For more information visit Asset & Logo Licensing.