The people of Earth spent the equivalent of about $2.6 trillion on premiums for life insurance products, including annuities and other life-based savings products, in 2016, according to analysts at Swiss Re.
World life premium spending was 2.5% higher than in 2015.
Life spending accounted for about 3.5% of the world’s $75 trillion gross domestic product in 2016.
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Spending on premiums for all types of insurance, including health insurance and property-casualty insurance, increased 3.1% in 2016, to $4.7 trillion, or 6.3% of world GDP.
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The analysts found that the performance of the U.S. life market was stronger than the performance of the Japanese life market, and of many life markets in Europe, but was much weaker than the performance of the life markets in Canada, the typical country in Latin America, and the typical country in Asia.
Life insurers in Mexico, for example, might want to build a wall to keep non-Mexican life insurers from rushing in to benefit from strong growth in life premiums there.
Inflation-adjusted life premiums fell 0.5% in the United States, to $559 billion. When expressed in inflation-adjusted U.S. dollars, life premiums grew 3% in Canada, to $50 billion, and about 12% in Mexico, to $11 billion.
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Inflation-adjusted life sales, expressed in U.S. dollars, rose 0.1% in Europe, to $859 billion; 1.2% in Africa, to $41 billion; 5% in Latin America, to $69 billion; and 7.4% in Asia, to $1 trillion. Sales fell 13% in Australia, New Zealand and other countries in Oceania, to $40 billion.
Life market performance varied widely from country to country, even within a continent.
Argentina, for example, turned in the worst life market performance in the world in 2016: Its inflation-adjusted 2016 premium revenue, expressed in U.S. dollars, fell 25%, to $2.3 billion. Premium revenue in Argentina rose in terms of local currency, without inflation adjustment, but a spike in inflation that resulted from currency exchange-rate fluctuations and changes in price control rules hurt inflation-adjusted U.S. dollar performance.
In Europe, Portugal ranked at the bottom, with 15% U.S. dollar market shrinkage. Russia ranked at the top, with 55% growth.
In Russia, strong bank insurance sales and attractive interest rates helped increase 2016 inflation-adjusted life premium revenue to the equivalent of $3.2 billion. A recovery in oil prices should help life premium revenue continue to increase this year and next, the Swiss Re analysts say.
Here’s a look at the life markets on the Swiss Re list that showed the strongest inflation-adjusted growth, when results were expressed in U.S. dollars.