Page 20 - Insurance Times December 2023

Automobile Manufacturers (CAAM), ket share in short-term insurance will nual growth rate (CAGR) of 9.0% over
total vehicle sales recorded an 8% also support growth over 2024–28. 2024–28, from CNY4.0 trillion ($597.1
growth during January-August 2023 as Deblina Mitra, Senior Insurance Ana- billion) in 2024 to CNY5.6 trillion
compared to the same period the pre- lyst at GlobalData, comments: “In Ja- ($893.2 billion) in 2028, in terms of di-
vious year. rect written premiums (DWP), accord-
pan, agencies are a prominent distri-
ing to GlobalData, a leading data and
Insurers’ premium collections are also bution channel for life insurance prod-
expected to benefit from higher pre- ucts. The channel witnessed a dip in analytics company.
mium prices for NEVs. Typically, NEV revenue in 2020 and 2021 due to the According to GlobalData’s Insurance
insurance premiums cost around 20% COVID-19 outbreak that limited face- Database, China’s life insurance indus-
higher than internal combustion en- to-face interaction, leading to slower try is estimated to grow by 9.6% in
gine vehicles. NEV sales accounted for industry growth. 2024, supported by economic recov-
29.5% of the total vehicle sales during ery, conducive regulatory develop-
“The industry GWP recovered with
January-August 2023 and recorded an ments, and increased awareness of
double-digit growth in 2022, primarily
increase of 39.2%, as compared to the health and financial planning after the
after the regulator reclassified COVID-
same period in the previous year, ac- 19 under the less severe Category Five pandemic, which led to a rise in the
cording to data from CAAM. demand for whole life and personal
infectious disease, leading to a revival
To promote the sale of NEVs, in June in agency sales. The trend is expected accident and health (PA&H) insurance
2023, the Chinese government ex- to continue in 2023 and beyond, sup- policies.
tended the ongoing subsidy for NEVs porting industry growth.” Manogna Vangari, Insurance Analyst
until 2027. The extended policy allows at GlobalData, comments: “After wit-
The introduction of a new review sys-
new NEVs bought in China until Decem- nessing a slower growth of 2.8% in
tem in early 2023 for agencies by the
ber 31, 2025, to receive a 10% pur- Life Insurance Association (LIAJ) will 2022, the Chinese life insurance indus-
chase tax exemption of up to try is expected to witness a double-
boost customer confidence and im-
CNY30,000 (US$4,447.8). From Janu- prove transparency, thereby positively digit growth of 13.7% in 2023, driven
ary 1, 2026, to December 31, 2027, influencing the channel’s growth over by economic recovery and the relax-
the exemption will be halved. 2024–28. LIAJ has set 200 standards ation of the zero COVID policy in De-
related to governance, personal data cember 2022, which has helped in in-
Japan life insurance indus- safety, customer support, and post- creasing the employment rate and
sales service under the new system. household disposable income.”
try to exceed $350 billion Agencies that qualify for these stan- Whole life insurance is the largest life
by 2028 dards are assigned a higher credibility insurance line, which is expected to

The Japanese life insurance industry is rating by the LIAJ. As of March 2023, account for 78.3% share of the life in-
forecast to grow at a compound an- 42 agencies were qualified by LIAJ. surance DWP in 2023. The demand for
nual growth rate (CAGR) of 2.0% from Single-premium foreign-currency-de- whole life insurance is driven by the
JPY37.1 trillion ($289 billion) in 2024 to nominated insurance products are also country’s demographic factors, such as
JPY40.2 trillion ($359.5 billion) in 2028, expected to support the industry’s an aging society and a high life expect-
in terms of gross written premiums growth in 2023, as ultra-low domestic ancy. According to GlobalData’s Mac-
(GWP), according to GlobalData, a interest rates since the late 1990s led roeconomic Database, the population
leading data and analytics company. to Japanese insurers offering policies in above 65 years old increased to 191.6
the US dollar and other foreign curren- million in 2022 from 184.6 million in
GlobalData’s Insurance Database re-
veals that the Japanese life insurance cies due to the higher interest rates 2021 and is forecast to reach 248.4
industry is expected to grow by 4.6% offered in those markets. million in 2030.
in 2023, supported by the revival of PA&H insurance is the second largest
agency distribution channels and per- China life insurance indus- line, which is estimated to account for
sistent demand for single premium for- try to surpass $890 billion 21.4% share of the life insurance DWP
eign currency-denominated insurance in 2023. PA&H insurance is expected to
products. Regulatory intervention in by 2028 grow at a CAGR of 4.8% during 2024-
improving agency standards and in- The Chinese life insurance industry is 28, supported by increasing health
creasing competition for greater mar- forecast to grow at a compound an- awareness post-pandemic.

The Insurance Times December 2023 19