The insurance industry's primary growth themes align with the direction proposed in China's 15th Five-Year Plan. Recently, Beat Strebel, CEO of Swiss Re China and Head of China Reinsurance Business, analyzed trends in China's property and casualty (P&C) insurance market during a media roundtable. He highlighted that China's high-quality development will create insurance opportunities, focusing on five key areas: disaster prevention and mitigation, green development, rural revitalization, overseas expansion of enterprises, and industrial modernization.
**90% Natural Disaster Protection Gap in China vs. 50% Globally** Regarding disaster prevention, Strebel noted that Swiss Re Institute estimates China's natural disaster protection gap at 90%, indicating significant market potential. Gianfranco Lot, Chief Underwriting Officer of Swiss Re Property Reinsurance, explained that global insured losses from natural disasters now exceed $100 billion annually, approaching $150 billion. In peak scenarios, potential insured losses could reach $300 billion worldwide. In 2024, global economic losses from natural disasters totaled $318 billion, with $137 billion insured. While about 50% of global economic losses are covered by insurance, China's coverage is only 10%. Governments are implementing measures to narrow this gap, emphasizing disaster prevention. "Insurers, reinsurers, and governments must collaborate as an ecosystem to enhance disaster resilience, improve loss coverage, and support post-disaster recovery," Strebel said.
**Green Insurance to Sustain High Growth Over Next Five Years** On green development, Strebel highlighted China's push for renewable energy adoption and green economic transformation. The energy conservation and environmental protection sector is projected to reach RMB 15 trillion by 2030. "Insurance penetration for green energy transitions and related investments is already high, with most solar and wind facilities in China covered by insurance or reinsurance," he said. Green insurance spans infrastructure projects, renewable energy, and electric vehicles. Swiss Re Institute expects sustained high growth in this sector, driven by expanding infrastructure rather than increased penetration.
**Two Growth Paths for Rural Insurance** For rural revitalization, Strebel emphasized China's focus on food security, agricultural productivity, and modernizing rural infrastructure. International experience suggests agricultural modernization will spur investments in assets and machinery. Agricultural insurance has two growth drivers: (1) organic growth as farm sizes expand and mechanization raises risk awareness, boosting penetration; and (2) addressing challenges smallholders face in affordability and accessibility through simplified products like index-based insurance, which offers faster claims settlement.
**Shifting Risk Profiles as Chinese Firms Expand Overseas** Swiss Re Institute anticipates accelerated overseas expansion by Chinese enterprises, with investments diversifying beyond infrastructure (e.g., transport, energy) into manufacturing. "Insurers have supported China's outbound实体经济, but evolving risk landscapes create opportunities for reinsurers to partner with clients," Strebel said. Reinsurers can mitigate overseas risks—political, legal, regulatory, economic, and natural disasters—to facilitate global expansion.
**Emerging Risk Management Needs from Industrial Upgrading** China's tech-driven industrial upgrade in green energy, EVs, and low-altitude economy is spurring demand for tailored risk solutions. "China is a vital market for global firms to explore new technologies, but challenges arise as these innovations lack long-term validation," Strebel noted. Insurers must adopt prudent underwriting strategies while learning and adapting. "These sectors will define future global competition."
**P&C Growth to Outpace GDP** Looking ahead, Strebel sees ample growth potential for China's P&C sector, with premiums projected to grow 5%–6% annually from 2025–2030, outpacing GDP. Non-auto lines will drive growth, while auto insurance remains a stable pillar. Underwriting profitability, historically low due to excessive competition, is improving as the industry prioritizes quality development, risk management, and operational efficiency, leading to lower combined ratios and sustainable profits.
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