sigma 7/2020, "Rebuilding better: global economic and insurance market outlook 2021/22"
"Sustainable recovery will require a new direction that includes, among others, more investment in sustainable infrastructure, in the digital economy and in human capital, to make societies future fit and growth more inclusive," Swiss Re mentions.
Study's findings show that COVID-19 has accelerated several paradigm shifts already in the making, including digital transformation, de-globalisation and a larger role for governments in the economy. Swiss Re expects structural shifts such as lower potential growth, lower real yields, and a widening rift between financial markets and the real economy.
"Sustainable economic recovery needs a policy reset that includes investment in infrastructure, technology and climate. Building new sustainable infrastructure will have a significant impact on GDP growth," Swiss Re added.
According to "sigma 7/2020", the insurance markets withstood this year's recession better than initially expected. The report is projecting a global non-life premium positive evolution of 1.1% for 2020 and a rebound to 3.6% growth in 2021 and 2022. On the life insurance side, global life premium volumes are expected to contract by 4.5% in 2020, but soon recover strongly to an annual 3% trend growth over the following two years.
Chinese insurance market will become a global leader, while emerging markets overall will continue to outperform advanced markets. Based on global economic recovery and rate hardening, we forecast a swift return to trend growth in the next two years.