Driven by strength in emerging Asia, insurance markets will grow despite weakening global economic growth, sigma says

• Global economic growth will weaken in 2020 and 2021; the engine of global growth will be emerging Asia
• Insurance markets continue to grow at trend due to very strong demand in emerging Asia, particularly China; non-life and life premiums will increase by around 3% in 2020 and 2021
• SRI forecasts slowdown in US economic growth to 1.6% in 2020, and 0.9% in the euro area, both below consensus
• The main risk to the growth outlook is escalation of US/China trade tensions; the euro area is at risk of "Japanification"
• Low and negative interest rates are here to stay; a new policy mix is needed, including fiscal spending in infrastructure and sustainable investments
• Non-life and life insurer profits are trending up; however, rising social inflation, particularly in US liability, is a growing drain

Insurance markets continue to support resilience, with global premiums forecast to increase by 3% annually in real terms in 2020 and 2021, despite a slowing world economy. In its latest sigma, "Sustaining resilience amid slowing growth: global economic and insurance market outlook 2020/21," Swiss Re Institute (SRI) forecasts US and euro area growth next year of 1.6% and 0.9%, respectively, below consensus. The main engine of the global economy will be emerging Asia, with near 6% growth in both India and China. The contribution of insurance to resilience will be greatest in this region as well. In China, non-life premiums are forecast to grow by 9% in 2020, and life premiums by 11%.

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