The size of the U.K. life market shrank much more drastically between 2007 and 2009 than the size of other major European life markets did.
Analysts at Cerulli Associates, Boston, discuss the performance of the life market in the United Kingdom in a discussion of wealth management opportunities in the European life insurance industry.
The United Kingdom has worked hard to build its financial services sector since the 1980s, and life premiums represented 12% of U.K. gross domestic product (GDP) before the recent crisis begin, the analysts say.
But that crisis hit the U.K. insurance market exceptionally hard, and life premium revenue fell to the equivalent of about $2,700 per person in 2009, from about $4,500 per person in 2007, the analysts report.
“We believe that lack of balance was a major weakness of the U.K. economy, because it obliged the government to take painful actions to help financial institutions (at a level that was unprecedented in Europe),” the analysts say.
In France, Italy and Germany, life premium revenue accounted for about 4% to 8% of GDP, and average life premium revenue per person was about the same in 2009 as in 2007, the analysts say.
- Allison Bell