GlobalData’s updated post-COVID-19 forecasts predict negative growth in total GWP for life insurance and general insurance in 2020. It forecasts a decline of 1.2% for life, compared to growth of 3% pre-COVID-19, and a decline of 2.2% in 2020 for general insurance, compared to 2.9% growth previously.

COVID-19’s impact on life insurers is partly offset by robust profitability and strong capitalization amid low interest rates. However, the continued impact of a looming economic crisis is a serious concern for Spanish insurers.

Deblina Mitra, Insurance Analyst at GlobalData, comments: “The economic crisis and lack of revenue is increasing risk for insurance companies offering credit and suretyship insurance. The Spanish Association of Insurance and Reinsurance Institutions (UNESPA) and the Insurance Compensation Consortium were authorized to conduct reinsurance activities in this field, which will help soften the blow.

“SMEs in the country faced huge losses of revenue during the pandemic and lockdown, which saw rises in delinquency. This, along with the impact on stock markets, has led to directors and officers of companies taking decisions that may be subject to accountability and liability. Therefore, losses related to D&O policies is expected to increase in the country. The pandemic has also caused a spike in event cancellations and cyber-crime, which insurers will be liable for, dependent on policy wording.”