In the private sector, life insurance has as its main objective to seek financial well-being, either through its risk aspect, with which to give peace of mind to the future of a person or their relatives, or especially from the one more oriented to savings and pension plans.
Life insurance has grown rapidly in recent decades in developing countries such as China and Brazil, reaching a penetration (volume of premiums in relation to GDP) of around 2.5%. On the contrary, in most of the most advanced economies, although their weight in the economy is much greater, they have been falling for years. In the US and Japan, life segment penetration has fallen to its lowest levels in 35 years, and in the UK, Germany and Switzerland to 20-25 year lows.
The latter is a trend that can be observed precisely at a time when long-term savings are most needed. Among its causes, the report of the Geneva Association, entitled Financial well-being: is it the key to reinventing life insurance?points out having lived through a period of low interest rates, which make it difficult to obtain returns, as well as the spread of chronic illnesses or less security in the labor market.
In this scenario, with several factors putting the financial well-being of millions of citizens at risk, the insurance sector still has a lot to contribute. In addition to more flexible and personalized products that adapt to new needs, among the proposals of the global association of insurers are that of promoting financial education in young people; collaborate in the development of preventive risk measures, for example in fields such as health through the analysis of the valuable data handled by these companies; or explore the possibilities of the senior economy or “gray hair economy”, of which MAPFRE is a benchmark through its Agingnomics research center.