BMI View : We expect growth in China's insurance sector to remain on an uptrend in the coming years due to the under-penetrated nature of the industry. However, increasing saturation in tier-one cities will push insurers to expand into lower tier cities. The ongoing liberalisation of the healthcare sector will unleash new growth opportunities within the health insurance sub-segment.
We forecast total gross premiums to slowdown in 2015 after growing by strong double-digit rates in 2014. We anticipate growth in premiums to come in at 5.5% (in USD terms) in 2015 versus 15.3% in 2014. The slowdown in the market is inevitable after strong double-digit expansion in each of the past three years. Furthermore, it is in line with our Country Risk team's view that the ongoing weakness in the Chinese economy will continue in the coming months, which will inevitably weigh on premiums.
Among the BRICS, China has the second lowest life insurance density after India. This in itself attests to the still under-penetrated nature of the segment, which will manifest into growth opportunities for life insurers. Indeed, we expect life density to increase from USD132.7 per capita in 2015 to USD158.3 per capita in 2018. As with many other emerging markets, life insurance in China is slowly becoming a key conduit of organised savings - in a country where savings are consistently greater than investment.
We believe that the increasing saturation in tier-one cities will push life insurers to expand into lower tier cities. Furthermore, we see the ongoing urbanisation of the country acting as a tailwind for firms as they can expand into newly created cities to broaden their customer base. This leads us to forecast growth in the life segment to outperform the non-life segment over the 2015-2018 period. We expect gross life premiums to grow at an annual average of 6.7% (in USD terms) over the 2015-2018 period to reach USD225.2bn by 2018.
China's non-life insurance penetration is currently at...
The China Insurance Report has been researched at source and features Business Monitor International (BMI)'s independent assessment and forecasts for the insurance sector. It examines industry developments, key growth drivers and risk management projections, including the macroeconomic situation, government policy, regulatory environment and the level of development and potential for growth, broken down by line. Leading insurers are profiled, covering premiums, products and services and competitive positioning.
BMI's China Insurance Report provides professionals, consultancies, government departments, regulatory bodies and researchers with independent forecasts and regional competitive intelligence on the Chinese insurance industry.
- Benchmark BMI's independent insurance industry forecasts for China to test other views - a key input for successful budgeting and strategic business planning in China's insurance market.
- Target business opportunities and risks in China through our reviews of latest industry trends, regulatory changes and major deals, investments and macroeconomic developments.
- Exploit latest competitive intelligence on your competitors, partners and clients via our Company Profiles (inc. SWOTs, KPIs and latest activity).
BMI Industry View
Summary of BMI’s key industry forecasts and views, covering the Life and Non-Life segments, the evolving competitive landscape and business operational risks.
Industry SWOT Analysis
Analysis of the major Strengths, Weaknesses, Opportunities and Threats within the insurance sector and within the broader political, economic and business environment.
BMI Industry Forecasts
Historic data series (2005-2014) and forecasts to end-2019 for key industry indicators, supported by explicit assumptions, plus analysis of key risks to the main forecasts. Indicators include:
- Life/non-life Premiums: Total premium growth (USDmn), premium growth (% y-o-y), penetration (% of GDP), density (USD per capita) for Life and Non-Life sectors, claims reinsurance, and assets and liabilities.
- Non-life subsectors: Data on gross written premiums for all major Non-Life segments (motor, transport, property, personal accident, health, general liability and credit financial).
BMI’s Insurance Risk Reward Index
BMI’s Risk Reward Indices provide investors (Life and Non-Life) looking for opportunities in the region with a clear country-comparative assessment of a market’s risks and potential rewards. Each of the country markets are scored using a sophisticated model that includes more than 40 industry, economic and demographic data points to provide an indices of highest to lowest appeal to investors, with each position explained.
Examines the competitive positioning and short- to medium-term business strategies of key industry players. The latest financial and operating statistics and key company developments are also incorporated within the company profiles, enabling a full evaluation of recent company performance and future growth prospects.
Growth Drivers & Risk Management Projections
Key data and forecasts to end-2019 focusing on the growth drivers and downside risks to specific insurance lines including:
- Population: Male/female, by age group, active/pensionable/youth population % of total, urban/rural population % of total.
- Freight: Tonnage – air freight, rail freight, road freight, inland waterway.
- Motor: Fleet size by type of vehicle % change y-o-y.
- Epidemiology: Disease Adjusted Life Years and private health expenditure.
Market Overview & Rankings
Illustration of the insurance industry via rankings tables comparing gross written premiums by company (USDmn) and market share (%) for the top 20 players in both Life and Non-Life. This chapter also includes in-depth regional analysis of the market position, business strategies and investment potential of the leading insurance companies.
The insurance Reports draw on an extensive network of primary sources, such as multilateral organisations, government departments, industry associations, chambers and company reports.
*Company profiles are not available for every country. Those reports instead contain information on the current activities of prominent companies operating in the market.