An Opportunity to Create New (Re)Insurance Markets
Transformative
Trends
Transformative trends are shaping the future risk landscape, creating $200+ billion of market potential for insurers by 2030. The top 10 opportunities will enable insurers to respond to customer demand while increasing the industry’s relevance, growth, and diversification. To capture this growth, insurers need to understand relevant trends and begin transforming their businesses through product development, talent and business culture.
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Deeper analysis reveals further insights into trend drivers and values, as well as confidence levels for trend development and market size. Deep dives can assess the insurance potential, identifying and quantifying opportunities for existing lines of business, or areas for product development. Bespoke analysis can also match potential opportunities against strategy, risk appetite and existing capabilities, as well as highlight gaps in skills, talent or capabilities.
Deep Dives
Strategy and Technology Group
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The concept of intellectual property refers to the legal entitlements that stem from intangible creations and assets. The four primary forms of intellectual property are patents, trademarks, copyrights and trade secrets, with a growing emphasis of digital assets.
All figures in 2023 U.S. Dollars
Many of the megatrends growth opportunities are immediate or would require relatively small investment in talent or technology by insurers. Other trends are less well developed at present, yet they represent potentially huge future markets for insurance.
Top Ten Transformative Trends
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Hurricane Ian was responsible for about 30 percent of economic and 40 percent of insured losses globally
As an industry, we cannot afford to sit on the sidelines and wait for these trends to crystalize. We have the expertise and ability to anticipate the future landscape and develop innovative products and solutions.”
Global
Choose a region to see the findings
“Global insured losses exceeded $100 billion for the third year in a row. Much of this total was driven by the impact of Hurricane Ian, but many regions of the globe recorded significant disaster events.”
Global and
Regional Findings
Global
U.S.
South America
North America
(non U.S.)
Europe
Middle East
Africa
Asia
Oceania
Flooding events drove losses in Asia-Pacific
Three drought events were among the top 10 economic loss disasters
View 2022 natural disaster events and loss trends
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Macroeconomic factors and uniqueness of the insurance space in Florida will impact loss development in the aftermath of Hurricane Ian”
Deadly flooding in Missouri and Kentucky in July left 43 fatalities
Severe convective storm outbreaks resulted in insured losses of $29 billion
Hurricane Ian is the second costliest insured event on record globally (behind Katrina)
Macroeconomic factors and uniqueness of the insurance space in Florida will impact loss development in the aftermath of Hurricane Ian”
Both severe drought conditions and a prolonged rainy season in different regions of Latin America reduced agricultural crop yield across the region”
U.S.
Subtropical storm Yakecan hit Brazil and Uruguay in May
A prolonged rainy season in Colombia and Venezuela claimed hundreds of lives
A record heatwave affected central parts of the continent in January
Both severe drought conditions and a prolonged rainy season in different regions of Latin America reduced agricultural crop yield across the region”
The May derecho impacted the most densely populated area of Canada, which drove payouts beyond CAD1.0 billion”
South America
The issue of climate change impacts in Europe was in the spotlight again, as the continent endured severe heat, drought and wildfires during the summer months”
Hurricane Julia claimed 91 lives in Central America in October
The May derecho was one of the costliest severe convective storm outbreaks in Canada’s history
After impacting Puerto Rico, Hurricane Fiona became the most intense post-tropical storm to hit Canada
The May derecho impacted the most densely populated area of Canada, which drove payouts beyond CAD1.0 billion”
North America
(non U.S.)
The Middle East endured notable flooding and earthquake events, which took a significant toll on human life and property in the region”
Europe was engulfed by heat and drought during the summer months
Hailstorms in May and June drove the 2nd highest insured losses in France on record
A series of windstorms Dudley, Eunice and Franklin caused $4.7 billion of insured loss in February
The issue of climate change impacts in Europe was in the spotlight again, as the continent endured severe heat, drought and wildfires during the summer months”
Europe
European Windstorm Series in February
Hurricane Ian – the Costliest Event of the Year
Global Drought and Heatwaves
Severe drought in Eastern Africa and historic flooding in the western and central parts of the continent affected millions of the most vulnerable and underlined the issue of climate resiliency”
A significant July earthquake caused notable losses in Iran
Devastating July floods in Iran claimed nearly 100 lives
Flooding occurred on the Black Sea coast of Turkey in June
The Middle East endured notable flooding and earthquake events, which took a significant toll on human life and property in the region”
Middle East
Despite the devastating events in Pakistan and elsewhere, total economic losses in Asia were significantly lower than recent
averages for the region”
The worst seasonal flooding in years affected West and Central Africa, particularly Nigeria
A record-tying 6 storms made landfall in Madagascar in Q1: Ana, Batsirai, Dumako, Emnati, Gombe and Jasmine
Deadly flooding in South Africa became the
costliest event for the national insurance industry on record
Severe drought in Eastern Africa and historic flooding in the western and central parts of the continent affected millions of the most vulnerable and underlined the issue of climate resiliency”
Africa
European Windstorm Series in February
Hurricane Ian – the Costliest Event of the Year
Global Drought and Heatwaves
Flood losses in Oceania broke historical records as the region suffered a third La Niña year, with the wettest winter in New Zealand and new rainfall records in Sydney.”
There were more than 1,500 erthquake-related deaths in Asia
Pakistan floods resulted in a far-reaching humanitarian disaster
A nationwide heatwave and a drought in the Yangtze River basin impacted China
Despite the devastating events in Pakistan and elsewhere, total economic losses in Asia were significantly lower than recent
averages for the region”
Asia
Sydney recorded its wettest year on record
The eruption of the Hunga-Tonga-Ha’apai volcano sent shockwaves around the world on January 15
East Coast floods in Q1 became the costliest insured event on record in Australia
Flood losses in Oceania broke historical records as the region suffered a third La Niña year, with the wettest winter in New Zealand and new rainfall records in Sydney”
Oceania
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20+bn
Rise in Intellectual Property (IP)
Achieving the net zero transition by 2050 will require a fundamental transformation of global energy systems with decommissioning of carbon-intensive assets playing a key role.
Decommissioning of Carbon Intensive Asset
5-10bn
Build Back Better - Resilient Infrastructure Development
1-5bn
Build Back Better involves resilient infrastructure development (both public and private) to drive economic growth and energy efficiency.
Electrification as a trend is the growth in manufacture and sale of battery powered vehicles and resulting decline in Internal Combustion Engine (ICE) vehicles.
Electrification
1-5bn
Biotechnology is the application of biological processes by various industries in order to develop breakthrough products, services and technology to combat diseases, reduce our environmental footprint, produce cleaner energy and more efficient industrial processes.
Biotechnology
1-5bn
Shared autonomous vehicles, hailed vehicles, car sharing, and air taxis represent the single largest megatrend insurance opportunity of our top ten.
Shared Mobility
40+bn
Prescriptive analytics examines data influx from a wide variety of internal and external sources and uses machine learning, image processing and statistics to come up with actionable insights to take advantage of future opportunities, with some systems having authority to make decisions automatically.
Prescriptive Analytics
100+bn
The metaverse is a virtual world in which people live, work, shop, and interact with each other. Due to the versatile nature of the metaverse, the impact on the insurance market will be wide-ranging.
Metaverse
20+bn
Carbon capture utilisation and storage involves capturing CO2 from industrial processes, including heavy industry, pumping the gas underground and storing in geological formations.
Carbon Capture Storage
1-5bn
Capturing megatrend insurance opportunities will require a systematic and disciplined approach to identify and assess both risks and opportunities. Insurers will need to establish a framework to understand the future landscape, using intelligence and insights to anticipate global macro trends, prioritise opportunities and begin to formulate a response.
5-step Framework
Sherif Zakhary
CEO, Strategy and Technology Group
1
Step 1
Develop an understanding of the future landscape
Step 2
Consider how the insurance industry will be impacted
Step 3
Identify and prioritise trends that will create insurance opportunities
Step 4
Carry out in-depth analysis to quantify the opportunity
Step 5
Develop a roadmap for action
Many of the megatrends growth opportunities are immediate or would require relatively small investment in talent or technology by insurers. Other trends are less well developed at present, yet they represent potentially huge future markets for insurance.
Electrification
Carbon Capture Storage
Metaverse
1
2
3
Megatrends call for a deliberate and informed strategy. In order to protect and grow in a changing environment, insurers need to understand and anticipate the future landscape, weighing up the risks and rewards.
To thrive in this future landscape, the industry will need the right skills and expertise, supported by insights and intelligence. We must attract a much wider and more diverse pool of talent, as well as develop a more innovative and adaptable culture.
Download the Whitepaper
Nature-based solutions are activities that result in the sustainable management and restoration of our ecosystem - such as conserving forests, wetlands and mangroves, soil carbon sequestration, or biochar application - often increasing the carbon carrying capacity of these ecosystems.
Emergence of nature based solutions and impact on biodiversity
1-5bn
Step 1
Step 2
Step 3
Step 4
Step 5
Step 5
Step 5
Step 4
Step 4
Step 3
Step 3
Step 2
Step 2
Develop an understanding of the future landscape
Step 1
5-Step Framework
Step 1
Consider how the insurance industry will be impacted
Identify and prioritize trends that will create insurance opportunities
Carry out in-depth analysis to quantify the opportunity
Develop a roadmap for action
Step 2
Consider how the insurance industry will be impacted
Step 4
Carry out in-depth analysis to quantify the opportunity
Step 5
Develop a roadmap for action
Step 3
Identify and prioritize trends that will create insurance opportunities
Develop an understanding of the future landscape
Step 1
View in more detail
Metaverse - $20+ billion USD
Prescriptive Analytics - $100+ billion USD
Insurance Opportunity by 2030
$180+ billion
At a time when the value proposition of insurance is under growing pressure, megatrends present an opportunity for the industry to increase its relevance, while also creating new markets and increasing overall premium.
Combined, Prescriptive Analytics, Shared Mobility, the Metaverse and IP could generate some $180+ billion in GWP by 2030
Intellectual Property - $20+ billion USD
Insurance opportunity size by 2030 in USD
View in more detail
Many of the megatrends growth opportunities are immediate or would require relatively small investment in talent or technology by insurers. Other trends are less well developed at present, yet they represent potentially huge future markets for insurance.
Top Ten Transformative Trends
Prescriptive analytics examines data influx from a wide variety of internal and external sources and uses machine learning, image processing and statistics to come up with actionable insights to take advantage of future opportunities, with some systems having authority to make decisions automatically.
Prescriptive Analytics
$100+bn
Build Back Better involves resilient infrastructure development (both public and private) to drive economic growth and energy efficiency.
Build Back Better - Resilient Infrastructure Development
$1-5bn
EVs are forecasted to account for 67% of vehicle sales by 2030.
Market expenditure is expected to grow to $178bn by 2030.
The Metaverse could generate economic value of up to $5trn by 2030.
Electrification as a trend is the growth in manufacture and sale of battery powered vehicles and resulting decline in Internal Combustion Engine (ICE) vehicles.
Electrification
1-5bn
Biotechnology is the application of biological processes by various industries in order to develop breakthrough products, services and technology to combat diseases, reduce our environmental footprint, produce cleaner energy and more efficient industrial processes.
Biotechnology
$1-5bn
$1-5bn
Nature-based solutions are activities that result in the sustainable management and restoration of our ecosystem - such as conserving forests, wetlands and mangroves, soil carbon sequestration, or biochar application - often increasing the carbon carrying capacity of these ecosystems.
Emergence of Nature Based Solutions and Impact on Biodiversity
$1-5bn
Electrification as a trend is the growth in manufacture and sale of battery powered vehicles and resulting decline in Internal Combustion Engine (ICE) vehicles.
Electrification
Carbon capture utilisation and storage involves capturing CO2 from industrial processes, including heavy industry, pumping the gas underground and storing in geological formations.
Carbon Capture Storage
$1-5bn
Achieving the net zero transition by 2050 will require a fundamental transformation of global energy systems with decommissioning of carbon intensive assets playing a key role.
Decommissioning of Carbon Intensive Assets
$5-10bn
The concept of intellectual property refers to the legal entitlements that stem from intangible creations and assets. The four primary forms of intellectual property are patents, trademarks, copyrights and trade secrets, with a growing emphasis of digital assets.
Rise in Intellectual Property (IP)
$20+bn
The metaverse is a virtual world in which people live, work, shop, and interact with each other. Due to the versatile nature of the metaverse, the impact on the insurance market will be wide-ranging.
Metaverse
$20+bn
Shared autonomous vehicles, hailed vehicles, car sharing, and air taxis represent the single largest megatrend insurance opportunity of our top ten.
Shared Mobility
$40+bn
Build Back Better involves resilient infrastructure development (both public and private) to drive economic growth and energy efficiency.
Build Back Better - Resilient Infrastructure Development
1-5bn
Electrification as a trend is the growth in manufacture and sale of battery powered vehicles and resulting decline in Internal Combustion Engine (ICE) vehicles.
Electrification
$1-5bn
Carbon capture utilisation and storage involves capturing CO2 from industrial processes, including heavy industry, pumping the gas underground and storing in geological formations.
Carbon Capture Storage
$1-5bn
Achieving the net zero transition by 2050 will require a fundamental transformation of global energy systems with decommissioning of carbon-intensive assets playing a key role.
Decommissioning of Carbon Intensive Asset
$5-10bn
The concept of intellectual property refers to the legal entitlements that stem from intangible creations and assets. The four primary forms of intellectual property are patents, trademarks, copyrights and trade secrets, with a growing emphasis of digital assets.
Rise in Intellectual Property (IP)
$20+bn
The metaverse is a virtual world in which people live, work, shop, and interact with each other. Due to the versatile nature of the metaverse, the impact on the insurance market will be wide-ranging.
Metaverse
$20+bn
Shared autonomous vehicles, hailed vehicles, car sharing, and air taxis represent the single largest megatrend insurance opportunity of our top ten.
Shared Mobility
$40+bn
Biotechnology is the application of biological processes by various industries in order to develop breakthrough products, services and technology to combat diseases, reduce our environmental footprint, produce cleaner energy and more efficient industrial processes.
Biotechnology
$1-5bn
Nature-based solutions are activities that result in the sustainable management and restoration of our ecosystem - such as conserving forests, wetlands and mangroves, soil carbon sequestration, or biochar application - often increasing the carbon carrying capacity of these ecosystems.
Emergence of nature based solutions and impact on biodiversity
$1-5bn
Shared Mobility - $40+ billion USD
Prescriptive analytics examines data influx from a wide variety of internal and external sources and uses machine learning, image processing and statistics to come up with actionable insights to take advantage of future opportunities, with some systems having authority to make decisions automatically.
Prescriptive Analytics
$100+bn
Insurance opportunity size by 2030 in USD
View in more detail