Global health premiums will likely contract in 2023 as post-pandemic normalisation continues, according to a Swiss Re report on the state of insurance across the world.
“We estimate that global medex premiums will fall by 0.6% in 2023, with a return to 0.6% growth in 2024 – well down on 2012‒2022 annual average of 4.5%,” the report said.
The predicted decline is mainly due to the end of the pandemic healthcare support policies in the US, the sigma report titled World insurance: stirred, and not shaken, warns.
“We see that as triggering a 1.4% fall in US health premiums in real terms in 2023,” the report said.
The predicted decline comes off a flat market for last year, as the demand sparked by increased risk awareness as a result of the pandemic started to wane.
A total of 49% of global non-life premiums comes from health insurance, Swiss Re said. With an 80% share of global health premiums, the US holds a huge influence over the global market.
“A decline in health premiums due to the end of the pandemic support policies in the US will likely offset some of the volume increases in other lines of business,” the report noted.
But the situation may be better for other regions.
“We see no change in advanced Europe and modest growth in most other regions outside of emerging Asia,” the report said.
“In China, we estimate premiums will grow by 8.9% in 2023, supported by government-backed medical covers such as Huiminbao31 and increased digitalisation.”
The sigma study was based on the direct premium volumes of insurance companies across 147 countries, regardless of whether they were privately or state owned. Premiums paid to state social were not included.