Insurances

The Insurances market in Iceland is projected to reach a gross written premium of US$506.90m in 2024.
Non-Life Insurances dominate the market with a projected market volume of US$448.50m in the same year.
The average spending per capita in the Insurances market is estimated to be US$1.34k in 2024.
When comparing globally, the United States is expected to have the highest nominal value, reaching US$3.8tn in 2024.
Looking ahead, the gross written premium is forecasted to have an annual growth rate (CAGR 2024-2029) of -3.18%, resulting in a market volume of US$431.20m by 2029.
Once again, in global comparison, it is anticipated that the United States will generate the highest gross written premium, amounting to US$3.8tn in 2024.
Iceland's insurance market is witnessing a surge in demand for volcanic eruption coverage due to the country's geologically active nature.

Definition:

Insurance is a financial arrangement that provides individuals or businesses with protection against unexpected financial losses. In exchange for regular payments, known as premiums, an insurance policyholder is covered in case of specific events, such as accidents, illnesses, or damage to property. When a covered event occurs, the insurance company compensates the policyholder, helping them recover from the financial impact of the loss or damage. Gross written premium (GWP) is the main indicator of the insurance market. It is the total amount of money that an insurance company collects from policyholders for their insurance coverage before deducting expenses or commissions.

Structure:

The insurance market comprises life and non-life insurances. The non-life insurance market covers the following insurance types: health, motor vehicles, property, general liability, and legal.

Additional information:

The market contains the following KPIs: gross written premium aggregated for all countries and regions, gross written premium per capita, gross claim payments, loss ratio – calculated as gross claim payments divided by gross written premium, for selected European countries the distribution channels of insurance bookings, and the share of insureds in the total population for over 50 countries for live, health, motor vehicle, property, general liability, and legal insurances.

Life insurances
Non-life insurances

Some non-live insurances, such as travel insurance, freight insurance, and accident insurance
Reinsurance

In Iceland, the Insurances market is experiencing notable growth and development. Customer preferences in the Icelandic insurance market are shifting towards more comprehensive coverage options, reflecting a growing awareness of the importance of insurance protection. Customers are increasingly seeking policies that offer a wide range of benefits and coverage, including health, property, and travel insurance. This trend aligns with global patterns of increased demand for insurance products that provide extensive coverage and financial security. Trends in the Icelandic insurance market point towards a rise in digitalization and online insurance services. Insurers are leveraging technology to streamline processes, enhance customer experience, and offer more personalized insurance solutions. This digital transformation is driven by the need to meet changing customer expectations for convenient and accessible insurance services. Additionally, there is a growing focus on sustainability and ethical practices within the insurance industry in Iceland, with insurers incorporating environmental and social considerations into their offerings. Local special circumstances in Iceland, such as its small population and unique geographical challenges, influence the insurance market dynamics. Insurers in Iceland must tailor their products to address the specific needs of the population, including coverage for natural disasters like volcanic eruptions and extreme weather events. Additionally, the country's high standard of living and strong social welfare system impact insurance preferences, with customers seeking policies that complement existing government provisions. Underlying macroeconomic factors, such as Iceland's stable economic growth and low unemployment rates, contribute to the positive outlook for the insurance market. A growing economy means increased disposable income, allowing individuals to invest in insurance products for added financial security. Furthermore, favorable regulatory environment and government support for the insurance industry create a conducive landscape for insurers to innovate and expand their offerings in Iceland.

Data coverage:

Data encompasses B2B and B2C enterprises. Figures are based on gross written premium, gross written premium per capita, gross claim payments, loss ratio, and distribution channels.

Modeling approach / Market size:

Market sizes are determined by a Bottom-Up approach, based on a specific rationale for each market layer. As a basis for evaluating markets, we use industry associations, national statistic offices, and international organizations, such as OECD. Next we use relevant key market indicators and data from country-specific associations such as insurance consumer spending, gross domestic product, insurance - consumer price index (CPI), population growth. This data helps us to estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the particular market. For example, exponential trend smoothing and HOLT-linear. The main drivers are insurance consumer spending and insurance - consumer price index (CPI).

Additional Notes:

The market is updated twice per year in case market dynamics change. The impact of the COVID-19 pandemic is considered at a country-specific level.

This report presents a comprehensive analysis and additional information on the Financial market, in a PDF format.

Both the number and cost of global risks are rising due to drivers, such as climate change and cyber crime, and these trends are impacting in the insurance industry. The global insurance market was worth almost six trillion U.S. dollars in 2022, but this looks set to increase substantially in the coming years. Cyber crime is consistently seen as a leading risk to global business by risk management experts. Meanwhile, the cost of natural disaster losses rose over the past two decades. These risks are likely to grow in the future, which will sustain the growth of the insurance sector.