Life insurance - South Africa | Statista Market Forecast

The Life insurance market market in South Africa is projected to reach a market size (gross written premium) of ZAR US$31.10bn in 2024.
The average spending per capita in the Life insurance market market is expected to amount to ZAR US$509.60 in 2024.
Furthermore, the gross written premium is anticipated to display an annual growth rate (CAGR 2024-2029) of -0.94%, resulting in a market volume of ZAR US$29.66bn by 2029.
In global comparison, the United States is projected to generate the highest gross written premium, amounting to US$1.3tn in 2024.
South Africa's life insurance market is experiencing a surge in demand due to the growing awareness of the need for financial protection and the rising middle class.

Definition:

Life insurance is a type of financial product that provides financial security for individuals and their families. In simple terms, when you buy a life insurance policy, you pay regular premiums to the insurance company. In return, if you were to pass away while the policy is in effect, your designated beneficiaries receive a lump sum payment, known as the death benefit, which can help them cover living expenses and financial needs. Life insurance is designed to provide peace of mind and support for loved ones in the event of the policyholder's death. 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.

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, and the share of insureds in the total population for over 50 countries.

Death benefit insurance
Endowment insurance
Disability insurance
Dowry insurance
Birth insurance
Term life insurance
Whole life insurance
Universal life insurance
Burial insurance
Other types of life insurance

Health Insurance
All non-life insurance types
Reinsurance

The Life insurance market in South Africa has been experiencing significant growth and development in recent years.

Customer preferences: Customers in South Africa are increasingly seeking life insurance products that offer not only financial protection but also investment opportunities and additional benefits such as health and wellness perks. This shift in preferences is driving insurance companies to innovate and offer more comprehensive and customizable life insurance solutions to cater to the evolving needs of the market.

Trends in the market: One notable trend in the South African life insurance market is the growing popularity of digital insurance platforms and online distribution channels. Consumers are increasingly turning to digital channels to research, compare, and purchase life insurance policies, prompting insurance providers to enhance their online presence and offer seamless digital experiences. Additionally, there is a rising demand for sustainable and ESG (Environmental, Social, and Governance) focused life insurance products, reflecting a broader global trend towards responsible investing and ethical consumerism.

Local special circumstances: The regulatory environment in South Africa plays a crucial role in shaping the life insurance market. With stringent regulations in place to protect policyholders and ensure financial stability, insurance companies operating in the country must adhere to compliance standards and transparency requirements. Moreover, the socio-economic landscape of South Africa, characterized by income inequality and varying levels of financial literacy, presents both challenges and opportunities for life insurance providers to design inclusive and accessible insurance products for a diverse customer base.

Underlying macroeconomic factors: The growth of the life insurance market in South Africa is closely tied to the overall economic performance of the country. Factors such as GDP growth, interest rates, inflation, and employment levels influence the demand for life insurance products and the affordability of insurance premiums for consumers. As the South African economy continues to recover from external shocks and domestic challenges, the life insurance industry is poised to benefit from a more stable and resilient economic environment, supporting further expansion and innovation in the market.

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.

The biggest life insurance market globally is the United States, and it was almost twice as large as the second-biggest market, China. People take out life insurance to financially support their loved ones after their death. The payout is often used to cover funeral expenses, replace income earned by the deceased, or pay for children's education. It can be paid out in a lump sum or as an annuity, which is paid in regular installments for either a specified time or for the lifetime of the beneficiary. In 2022, the United States was the leading life insurance premium writing country, with a total value of life direct premiums written exceeding 600 billion U.S. dollars. The second and third-largest life insurance markets were China and the United Kingdom, respectively.