The global insurance industry will grow at a compound annual growth rate of 3.5% per year to reach $7.5 trillion by 2025, according to data from the portal compraracciones.com.
According to the report, the global insurance sector was one of the few that went against the tide and maintained an upward trend during the pandemic. It is expected to maintain robust growth in the coming years, despite considerable fund displacement caused by digital transformation.
The study explains that the global insurance intermediary industry was worth $6.1 trillion in 2020. It is projected to grow at a compound annual growth rate of 3.5% to $7.5 trillion by 2025. However, due to The ongoing digital transformation, as much as $280 billion could shift from traditional insurers to digital insurers.
Evolution of mediators in the world
To keep up with digital transformation, the report finds that insurance agents and brokers are increasingly investing in digital technologies. A recent insurance digital transformation survey reveals that 39% of mediators have online portals. Some 78% of mediators use Facebook to acquire new customers, while 68% use LinkedIn. The global insurance agent and broker market will grow at a compound annual growth rate of 3.5% by 2021, from $350.4 billion in 2020 to $362.54 billion.
The study expects the acceleration to digital channels to permanently alter the future revenue landscape for insurers. Approximately $140 billion in current insurance revenue could shift to technology-enabled products and services. Another $140 billion is expected to shift to insurers offering digital distribution services. Therefore, to take advantage of industry growth, they expect insurers to embrace the digital shift.
The convergence of the Health and Wealth Management industry with Life insurance is expected to generate an additional $120 billion. This will come from `smart' Health products ($60 billion), aging population products ($30 billion) and direct life and wealth management products (another $30 billion).
Another $50 billion will come from climate change-related risks. Cybersecurity threat mitigation services will also generate an additional 25 billion.
News Source: Seguros News 3/5/21