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US and China lead insurers to $3.7 trillion by 2020

The global non-life insurance market will exceed $US2.7 trillion ($3.79 trillion) by 2020, buoyed by strong growth in the US and China, according to research group MarketLine.

The market grew 5.4% a year from 2011-15 to $US2.03 trillion ($2.64 trillion), it says.

Severe weather events in the US, which accounts for almost 40% of global insurance revenue, have lifted property cover, particularly in Florida, where 14% of insured catastrophe losses occur.

China’s motor insurance market has grown rapidly since the nation introduced compulsory third party cover in 2006. Motor cover now accounts for 57% of the non-life market.

More cars on China’s roads and drivers choosing expensive, comprehensive cover is fuelling the boom.

The global non-life market is forecast to grow at 5.9% a year from 2015-20.

MarketLine analyst Nicholas Wyatt says there is scope for growth beyond that.

“Motor insurance is comfortably the market’s largest segment, and there are still a number of sizeable, largely untapped markets,” he said.

“In countries such as Indonesia and South Africa, car insurance is not a legal requirement and there is a chance such jurisdictions could bring their legislation into line with that of other nations. This could serve as a catalyst for further market growth.”

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