According to Forbes, the insurance industry was ‘enormously profitable’ in 2020, leading to insurers rising up in ranking in its annual Global 2000 list. Ten insurers made the top 100, with eight of them rising in rank from 2020. Out of the entire list of 2,000 companies, over five per cent were from the insurance industry.
China’s Ping An is the highest-ranked insurer at number six. According to Forbes, Ping An reported US$169 billion in revenue and $20.7 billion in profits, with its market capitalisation at $211 billion. In second place is US-based UnitedHealth Group, ranking at 21. The company brought in $262 billion in sales and $16.8 billion in profit. Over the past year, its shares have risen 41 per cent and the company is now valued at $388 billion.
Forbes highlights climate change effects as risks
Germany’s Allianz followed at 24th, up one spot from the previous year. Of the others that made the top 100, their ranks are: China Life (49), AXA (54), AIA (55), MetLife (62), Zurich (75), Japan Post (87), and Manulife (93). Warren Buffett’s Berkshire Hathaway, which includes insurance businesses Geico and Gen Re, placed third overall, with a market value of $624 billion.
Aside from the risks caused by business stoppage due to the pandemic, Forbes also highlighted the effects of climate change, especially for P&C insurers. Citing data from McKinsey, it said that climate-induced hazards currently threaten two per cent of global GDP, and this figure could grow to over four per cent of global GDP by 2050.
While this comes as good news to the general insurance industry, Capgemini and Efma’s World Insurance Report 2021 finds that insurers need to rethink their distribution models to offer uninterrupted service, superior customer experience, and maximum value, as the industry’s business dynamics continues to evolve.