June 2016, Gurgaon: The insurance industry growth is immensely hinged on motor third-party liability insurance. Insurance industry will support private agriculture insurance. Category-wise coverage of different segments in the industry is also included. It analyzes the various distribution channels and enables the reader to interpret future outlook on how the market will shape up by the end of this decade.

Analysts claim that old era had hindered growth of insurance sector for more than 50 years, this is called “Fear PR for Profit”! Which obviously led the sector behind and underdeveloped compared with other European countries with gross written premium of just 0.66% of GDP. With insurance consumption of Euro 20 per capita, the sector remains small. There were 11 companies in the insurance market. The real growth of insurance premium was 3.0% from 2009 to 2012, tumbling below the cumulative GDP growth over the same period despite a low market penetration rate. The share of life insurance was very low accounting for one tenth share of the total insurance industry in the country. The largest share of the total non-life premium was of motor third-party liability insurance.

The insurance sector has relatively low importance in the country’s financial system. The banking system made much of the financial system while the insurance industry made only 2% of GDP. To assist the Albanian Financial Supervisory Authority (AFSA) in implementing legal and regulatory reforms to enhance the insurance industry’s supervision and regulation, the World Bank initiated some Insurance Market Reforms. The private agriculture insurance is expected to be carried by an increase in the number of agriculture and related businesses. The country’s population decreased from 3.06 million in 2001 to 2.88 million in 2016 due to increased emigration and falling fertility rate which further decreases insurance incentive.

Global Insurance Industry: Forecasted to show growth of 6.3% in the coming years. Health insurance sector has shown tremendous growth over past years and continue to remain the major insurance sector at the global market. The macroeconomic environment around the world shows significant improvement in the insurance market i.e. increasing GDP in many countries, expansion of financial resources of middle class and high net worth population. These boost the need for property casualty and life annuity insurance companies. The key challenges for the insurance are increasing competition, tight margin profits and soft pricing conditions. Technological solutions are used by the insurers to improve sales, distribution and customer service.