Belgium Life Insurance Market to See Sustained Growth, According to Timetric31 Aug 2012 • by Natalie Aster
The Belgian life insurance segment accounted for the largest proportion of gross written premiums with a share of 65.1% in 2011, after registering a CAGR of -3.9% during the review period. This negative growth was attributed to the consequences of a decreased demand for life insurance products linked to the stock market, such as individual unit-linked and pension products, as a result of the unstable stock market and the economic crisis in 2009. Moreover, the sovereign debt crisis in the country and other European member states made the situation worse, leading to a rise in unemployment and a reduction in wages for public sector workers, including Members of Parliament. It was further discouraged by political instability as the country had been without a central government for 541 days and subsequent credit ratings were downgraded by the leading rating agencies, Standard & Poor’s and Moody’s. The combination of these factors discouraged Belgian consumers to purchase life insurance products, in particular, unit-linked and pension insurance products, as other commodities took priority.
However, the political situation improved following the formation of a new government in December 2011. The country’s macro and microeconomic fundamentals also improved as the International Monetary Fund (IMF) projected a positive economic development over the forecast period.
New market research report “Life Insurance in Belgium, Key Trends and Opportunities to 2016” by Timetric provides in depth market analysis, information and insights into the Belgian life insurance market, including:
Belgian life insurance market’s growth prospects by life insurance categories and customer segments;
various distribution channels in the Belgian life insurance market;
competitive landscape in the Belgian life insurance market;
description of the life reinsurance market in Belgium.
Life Insurance in Belgium, Key Trends and Opportunities to 2016
Published: August, 2012
Price: US$ 1.950,00
Life insurance products linked to the stock market, such as unit-linked and pension insurance products, registered variable growth rates during the review period. These categories registered positive growth in 2010 and 2011 but declined sharply in 2008 and 2009 due to the economic crisis in these periods. In addition, Belgium and other European member states have been under tremendous pressure due to the ongoing sovereign debt crisis and instability in key markets. Global economists believe that the region may decline into a double digit recession over the next year.
As a result of these factors, a reduction in wages for public sector workers, including Members of Parliament (MPs), was made in order to help ease the increasing levels of debt. The income levels of employees decreased as a consequence and forced the country to take extra measures when it came to investments. Many consumers took advantage of the partial withdraw option in order to protect their life insurance savings and liquid their positions. This was because the loss ratio by insurance companies was higher during the review period. At the time of financial instability, wealthy Belgian consumers tended to avoid investments on insurance products due to the involvement of risk and the fact that bank savings were preferred during this time.
According to US Census Bureau data, life expectancy in Belgium increased from 79 in 2005 to 80 in 2012. This is projected to reach 81 by 2025. Such high life expectancy supported the life insurance segment and sustained its growth. This is also expected to benefit the segment over the forecast period. An increasing life expectancy means it is projected that the population will purchase various life insurance products, including pension and annuity insurance products.
More information can be found in the report “Life Insurance in Belgium, Key Trends and Opportunities to 2016” by Timetric.
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