Best’s Italian Insurance Sector Report Sees Growth Despite Weak Economy

A special report from A.M. Best concludes that “Italy’s insurance market remained buoyant in 2014 and is well-placed to continue to grow in 2015, driven by demand for life products.” Best foresees a “second consecutive year of double-digit expansion in gross written premium (GWP).”

The report also pointed out that the Italian insurance industry achieved growth in 2014, “despite a difficult economic environment.” Moreover, Best added that the “Italian government is gradually making headway with its reforms to stimulate productivity.”

In the report, titled: “Italian Insurance Sector Maintains Strong Growth Despite Sluggish Economy,” Best notes that “in 2014, total GWP rose 20.7 percent to €143.3 billion [$158.6 billion], building on the 13 percent increase achieved in 2013.

“This was a consequence of strong life insurance growth, with low interest rates pushing investors away from traditional products (such as bank deposits and investment funds) and towards alternative investment solutions. The Italian insurance market is dominated by life products, representing 77.1 percent of total GWP in 2014.”

For 2015, Best indicated that “while an increase in GWP in the region of 20 percent or above may be harder to achieve,” it nonetheless anticipates “double-digit growth.” According to one of Best’s exhibits non-life premiums in 2014 were about where they were in 2002, at around €38 billion [$42 billion].

Best duly explained that “non-life GWP continued to decline in 2014, decreasing for the third consecutive year. This contraction was reflected through its largest segment – third-party
motor and marine insurance (representing 46.4 percent of non-life premium income) – and which continued to remain under pressure with a decline of 6.5 percent following a decrease of 7 percent in 2013 as prices fell due to the high levels of competition in the market.”

Source: A.M. Best

Topics Trends Market