Non-life insurances - Pakistan

Pakistan

The Non-life insurance market in Pakistan is expected to see significant growth in the coming years.
By 2024, the market size, measured by the gross written premium, is projected to reach US$4.68bn.
This indicates a positive trend in the demand for non-life insurance products in the country.
Furthermore, the average spending per capita in the Non-life insurance market is estimated to amount to US$19.07 in 2024.
This demonstrates the willingness of individuals in Pakistan to invest in insurance coverage to protect their assets and mitigate potential risks.
Looking ahead, the gross written premium is anticipated to exhibit an annual growth rate of 1.89% from 2024 to 2029 (CAGR 2024-2029).
This growth trajectory is expected to result in a market volume of US$5.14bn by 2029, indicating a steady expansion of the non-life insurance sector in Pakistan.
In a global context, it is worth noting that the United States is projected to generate the highest gross written premium in 2024, amounting to US$2,500.0bn.
This highlights the dominance of the US market in terms of revenue generation within the non-life insurance industry.
Overall, the non-life insurance market in Pakistan is poised for growth, driven by increasing awareness of the importance of insurance coverage and a growing economy.
It presents opportunities for both insurers and individuals looking to secure their assets and manage risks effectively.
Pakistan's non-life insurance market is seeing a surge in demand due to increased awareness and a growing middle class.

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Analyst Opinion

In Pakistan, the Non-life insurance market is experiencing significant growth and development.

Customer preferences: Customers in Pakistan are increasingly recognizing the importance of protecting their assets and investments through non-life insurance policies. With a growing middle class and rising disposable incomes, individuals are more willing to invest in insurance products to safeguard their properties, vehicles, and businesses against unforeseen risks.

Trends in the market: One noticeable trend in the non-life insurance market in Pakistan is the increasing demand for health insurance policies. As healthcare costs rise and awareness about the benefits of health coverage spreads, more individuals and families are opting for comprehensive health insurance plans. Additionally, there is a growing trend of businesses in Pakistan securing non-life insurance policies to protect their assets and operations from various risks such as natural disasters, theft, and liability claims.

Local special circumstances: In Pakistan, the regulatory environment plays a crucial role in shaping the non-life insurance market. The Securities and Exchange Commission of Pakistan (SECP) regulates and supervises the insurance industry to ensure stability and consumer protection. The presence of strong regulatory oversight helps build trust among customers and insurance providers, fostering further growth in the market.

Underlying macroeconomic factors: Several macroeconomic factors contribute to the development of the non-life insurance market in Pakistan. The country's stable economic growth, increasing urbanization, and infrastructure development create opportunities for insurers to expand their customer base. Moreover, the government's focus on promoting financial inclusion and risk management further drives the demand for non-life insurance products across various sectors of the economy.

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.