Swiss Re Foresees Rising Premiums Amid Increasing Global Risks

In a comprehensive analysis, Swiss Re Institute predicts that global property and casualty insurance premiums will rise in tandem with GDP over the upcoming decade.

This growth is driven by amplified natural catastrophe losses, asset accumulation, and heightened economic and litigation claims inflation.

The institute's report outlines the evolving insurance landscape amid increasing global risks.

The report anticipates reduced market concentration with heightened competition. It highlights an emerging trend where brokers and managing general agents are becoming more integral in distribution and underwriting processes. By leveraging these entities, insurers can access specialised skills and scale efficiently.

The global property and casualty market has experienced significant expansion, doubling over the past two decades to reach a value of $US2.4 trillion ($3.6 trillion). With ongoing innovation expanding coverage access through both traditional and alternative methods, projections indicate that the market could grow to $US4.3 trillion ($6.5 trillion) by 2040.

Furthermore, captive insurers are estimated to control $US60-$US80 billion ($91-$122 billion) in global premiums. These entities enable corporations to self-insure frequent risks while utilising reinsurance for major exposures. Meanwhile, insurance pools and mechanisms like US fair access programs and wind pools are increasingly addressing market volatility by ensuring availability where traditional options may be limited.

Swiss Re's Group Chief Economist, Jerome Jean Haegeli, notes that pricing, risk management, and transformation have become more efficient within the insurance sector. This efficiency supports capacity even as uncertainties rise, with insurers increasingly shifting risk burdens to reinsurers. This trend reflects growing demands for risk transfer amid an evolving risk landscape.

The report, titled "Growing Stronger: How the Property and Casualty Market Adapts to a Riskier World," highlights a marked 7% compound annual growth rate in reinsurance premiums over the past decade, outpacing the 4.2% rate in primary property and casualty insurance.

Swiss Re's findings were shared during the Reinsurance Rendezvous in Monte Carlo, providing a backdrop for industry stakeholders assessing and adapting to the complexities of a riskier global environment.

Published:Wednesday, 10th Sep 2025
Source: Paige Estritori

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Knowledgebase

Replacement Cost:
The amount it would cost to replace or rebuild an insured asset with one of similar kind and quality, without depreciation.