Thus, "property insurance is forecast to become the fastest growing line of business. Motor, although its share is shrinking, is expected to remain the largest of all P&C lines, with premiums forecast to almost double by 2040".
Property insurance is forecast to grow by 5.3% annually with global insurance premiums rising to USD 1.3 trillion in 2040 from USD 450 billion in 2020. "Economic development will remain the key driver of rising property premiums, contributing 75%, or up to USD 616 billion of new premiums. Climate-related risks are expected to result in a 22% increase in global property premiums, or up to USD 183 billion, over the next 20 years as weather-related catastrophes will likely become both more intense and frequent".
As social inflation is expected to drive up the frequency of large verdicts and settlements, especially in the US, liability premiums are forecast to grow by 4.7% per year on average to USD 583 billion until 2040 from USD 214 billion in 2020. "Additional areas of long-term growth potential in liability come from climate change effects, artificial intelligence, and social and legal changes".
As the more volatile property and liability segments are gaining in significance, the share of motor insurance, traditionally a lower-risk and high-volume mainstay segment of P&C, will shrink due to safety improvements from automation and smart technology and a drop in associated claims. While the share in the P&C risk pool is expected to shrink to 32% of sector premiums by 2040 from 42% in 2020, motor will remain the largest line of business, with premiums forecast to almost double up to USD 1.4 trillion by 2040 from USD 766 billion in 2020.