Life insurance - Ethiopia

Ethiopia

The Life insurance market market in Ethiopia is expected to reach a market size (gross written premium) of US$2.56bn in 2025.
Per capita, the average spending in the Life insurance market market is projected to be US$19.22 in the same year.
With an annual growth rate of 3.43% (CAGR 2025-2029), the gross written premium is estimated to increase, resulting in a market volume of US$2.93bn by 2029.
When compared globally, the United States is anticipated to generate the highest gross written premium of US$1,339.0bn in 2025.
The life insurance market in Ethiopia is experiencing steady growth due to increasing awareness and demand for financial protection among the population.

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Analyst Opinion

Ethiopia, a country in the Horn of Africa, has been experiencing notable developments in its life insurance market.

Customer preferences: Ethiopian customers are increasingly recognizing the importance of life insurance as a means of financial security and protection for their families in case of unexpected events. The shift towards more long-term financial planning and risk management is driving the demand for life insurance products in the country.

Trends in the market: One of the key trends in the Ethiopian life insurance market is the growing awareness and education about the benefits of life insurance. As more people understand the value of having life insurance coverage, the market is experiencing a steady increase in the number of policyholders. Additionally, the introduction of innovative life insurance products tailored to the needs of the local population is further fueling market growth.

Local special circumstances: Ethiopia's life insurance market is unique due to the country's demographic profile and economic landscape. With a large young population and a rising middle class, there is a growing need for life insurance products that cater to the specific requirements of these demographic segments. Moreover, the government's efforts to promote financial inclusion and regulatory reforms in the insurance sector are shaping the market dynamics in Ethiopia.

Underlying macroeconomic factors: The development of the life insurance market in Ethiopia is also influenced by broader macroeconomic factors such as economic growth, stability, and regulatory environment. As the country continues to experience economic expansion and stability, more individuals and businesses are inclined to invest in life insurance as a way to safeguard their financial well-being. Additionally, the government's commitment to improving the regulatory framework and promoting private sector participation in the insurance industry is creating a conducive environment for market growth.

Methodology

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.