Swiss Re CEO optimistic about China prospects | Insurance business America
Nation has a “real competitive advantage”
reinsurance
By Kenneth Araullo
Christian Mumenthaler, CEO of Swiss Re, expects significant growth in China’s insurance sector, which is expected to double in the next decade.
This growth comes amid China’s robust economic expansion, despite some concerns about a possible slowdown. Mumenthaler noted that China remains one of the fastest growing economies in the world, with an expected growth rate of around 5%.
In a report by China Daily, Mumenthaler explained that the Chinese insurance market is growing faster than the overall economy.
“We expect premiums to double in ten years, so we want to be part of that,” he said, underscoring the strategic importance of the Chinese market for Swiss Re’s business.
China is well on its way to becoming an increasingly important market for Swiss Re, as the country is already considered an important strategic location. The insurance penetration rate in China is relatively low and the gap between economic and insured losses in natural disasters remains significant. These factors highlight the growth potential in sectors such as catastrophe, corporate and agricultural insurance.
Swiss Re’s exposure to China is significant: net premiums and fee income in the country totaled $1.537 billion in 2023, representing approximately 3% of total net premiums. This makes China Swiss Re’s fifth largest market and its largest emerging market.
Mumenthaler mentioned that Swiss Re has developed “very close, very strong relationships” in China since establishing a wholly owned office in Beijing in 2003. He cited the early liberalization of China’s reinsurance market following WTO accession as a reason for Swiss Re’s strong position in the region.
Looking forward, Swiss Re is focused on expanding its mortality products in China to respond to the country’s aging population. Property and casualty insurance products also offer significant opportunities, particularly in areas related to natural disasters, agriculture and the green transition.
Mumenthaler expressed optimism about China’s progress in green transformation, which could open up new business opportunities for Swiss Re as the country leads the production of vital green materials such as steel and aluminum.
“In terms of decarbonization, I think China has a real potential competitive advantage because China probably installed more green energy last year than the rest of the world,” he said.
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2024-04-26 14:23:53
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