Outlook
As per GlobalData's Property Insurance Industry Outlook in Europe in 2022 report, property insurance growth in Europe recovered in 2020 at 3.2% as compared to a flat growth in 2019 due to premium price hardening owing to escalating natural catastrophe losses.
Despite the outbreak of COVID-19, the rise in commercial property renewal prices supported the growth of property insurance premiums in the region. Overall, property insurance is expected to grow by 3.8% in 2022 to reach $140 billion.
Property insurers are expected to leverage data and behavioral technologies such as AI, machine learning, and IoT to develop personalized insurance products and improve profitability. This includes the use of home-telematics systems/smart home solutions to ensure a more actual, risk-based accurate premium pricing. Allianz, one of the top insurers in the region, collaborated with Panasonic in Germany to develop its smart home solution.
Europe’s vulnerability to large-scale losses resulting from flooding, storms, drought, heat waves, and forest fires will see more insurers adopting selective underwriting and increased adoption of technology such as risk-hazard mapping and ariel imagery.
Climatic factors will remain key risks influencing premium prices over the next five years. While the developments related to the green economy and digitalized insurance solutions will be key insurance trends.
Pandemic Insurance Pool
To address future disasters resulting from pandemics, riots, natural catastrophic events, and terrorist attacks, French insurance industry stakeholders started working on an insurance pool ‘CATEX’ in 2020.
CATEX will cover small enterprises against business interruption (BI) losses arising from such disasters. The insurance will be included in a fire insurance policy and standard BI cover.
Private insurance and reinsurance companies have pledged an annual sum assurance of EUR2.0 billion. Any loss above this amount will be covered by the government.
Industry stakeholders and governments across the globe are engaging in discussion about the creation of a similar system to address future pandemics.
European property insurance competitive landscape was fragmented
According to GlobalData's Property Insurance Industry Outlook in Europe in 2022 report, the European property insurance market was fragmented and highly competitive in 2020.
Generali, the Italian conglomerate, was the leading property insurer with 5.6% of the market share in 2020. It operates in over 50 countries worldwide. Apart from Europe, the insurer has a strong presence in the Asia-Pacific and South and Central American property insurance markets.
Finland-based Sampo Plc with a share of 4.7% was the second-largest insurer in 2020. The group has a substantial presence in the Nordic region via its subsidiaries including Mandatum Holdings and Topdanmark.
Germany-based Allianz SE was the third-largest European property insurer in 2020 with a 4.1% share. Allianz’s global subsidiaries include AGCS, which provides corporate and specialty insurance solutions such as risk transfer, captive insurance services, energy insurance, engineering insurance, property insurance, and fire insurance, among other lines.
Access the report: Property Insurance Industry Outlook in Europe in 2022.
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