General/Non-life Insurance Services

General/Non-life Insurance Services Global Market Outlook

• The global general and non-life insurance market is estimated at almost $3,894 billion globally in 2022. The annual premiums are expected to rise by 2.2 percent in 2023, owing to ongoing rate hardening, primarily in commercial lines, despite slowing down to 0.8 percent in 2022

• The main impact of inflation will be rising claims costs. Motor and liability lines of business will most likely be impacted first. Accidents, motor vehicles, and general liability will all be affected, with inflation feeding into bodily injury claims

• The US has the highest market maturity, followed by Europe

• The APAC and parts of Western Europe are expected to be the future growth-driving markets for general insurance services

Drivers and Constraints : General/Non-life Insurance Services

• Post the COVID-19 pandemic, the demand for P&C insurance policies increased and so did the premiums, due to the increase in costs of fuel, automobile parts, and repairs. Rising inflation and Climatic change risks are also major factors to impact Non-Life insurance premiums.

Drivers

Increase in repair costs of automobiles

• Increase in automobile repair costs, due to price hikes of counterparts, semiconductors, etc. People are ready to pay for their motor insurance because they are unwilling to completely bare their vehicle’s high repair costs

Raising Climatic Change

• As several natural disasters are happening around the world, such as floods, hurricanes, etc., people are driven toward buying property insurance. The rising climatic risks will have a major impact on the increase in property insurance

Technological advancements

• Emerging new technologies in the market will eventually drive the demand for liability insurance. Technologies, such as artificial intelligence, and self-driving cars, will bring out security issues, such as cyber risks, which will make people invest in liability insurance

Constraints

A decline in motor insurance

• As automobiles are getting safety, improving through smart technologies and automation, growing usage of shared mobility and public transport may curb the motor insurance market in the coming years

Increase in insurance premiums

• Rise in inflation is a major reason behind the increase in insurance premiums. Motor and liability lines of business will most likely be impacted first. Accidents, motor vehicles, and general liability will all be affected, with inflation feeding into bodily injury claims. Climate change risks and urbanization also play a vital role in the surge in premiums.

Impact of COVID-19

• The COVID-19 pandemic increased the labor shortage. P&C insurance companies started to struggle without having the required insurance professionals

General Insurance: Brokerage Firm: Cost Structure

It is observed that commission fees vary by type of insurance and risk coverage. A brokerage fee is also included as a part of the premium pricing in the insurance.

Claims Processing Costs:

• Technology-driven insurance brokers assessed their client’s unique culture, strategic business model, and organizational objectives, and understand the client’s workforce by identifying prevailing employee health risks and by analyzing health metrics. Sensor-based wearables can help health and wellness insurance brokers redefine customer engagement models, and improve underwriting performance by tracking the health parameters of the employees (clients’ employee base) and assessing the risk profiles accordingly

Product Portfolio Claims and Coverage:

• Insurance brokers are taking advantage of insurance analytics and real-time data to redefine product portfolios and redesign clauses for claims and disbursal

• In the long term, the benefits of these technological advancements are expected to outweigh costs for insurance companies by reducing labor costs. However, the cost of technology will continue to be incurred