Ashish Raj, Insurance Analyst at GlobalData, commented: “After contracting by 2.1 per cent in 2020 due to the pandemic, the German economy is expected to grow by 2.8 per cent in 2022. The economic recovery is driven by strong government fiscal measures that include increased healthcare spending, short-term subsidies to preserve jobs, grants for small businesses and self-employed persons, and temporary VAT reduction.”
The economic recovery is expected to support general insurance industry growth, which is expected to grow by 4.7 per cent in 2022.
Personal accident and health insurance largest insurance line
Raj added: “Personal accident and health insurance is the largest general insurance line in Germany, having accounted for 38.8 per cent of the DWP in 2020. The segment grew by 3.6 per cent in 2020, driven by increased health awareness during the pandemic and rising healthcare costs. The segment is forecast to grow at a compound annual growth rate (CAGR) of seven per cent during 2021-26.
“Property insurance is the third-largest segment, which accounted for 17.2. per cent of the DWP in 2020. The segment is forecast to grow at a CAGR of 9.4 per cent during 2021-26, driven by an increase in property sales due to low property/mortgage interest rates.”
Ashish concluded: “Germany’s economic recovery is expected to remain subdued over the next couple of years due to a surge in fresh Covid-19 cases and the negative impact of the Russia-Ukraine conflict. However, increasing healthcare costs, rising industrial growth, and a boost in demand for real estate will support growth in the general insurance industry over the next five years.”