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RnRMarketResearch.com adds latest report “Life Insurance in Ireland, Key Trends and Opportunities to 2017” to its store.
Dallas, TX (PRWEB) February 03, 2013
The Irish life insurance segment is amongst the top 15 largest in Europe in terms of gross written premiums. The segment holds the largest share of the country’s insurance industry, accounting for 58.9% of the total gross written premiums in 2012. The Irish life insurance segment is highly concentrated with the five leading players accounting for 85% of the total gross premiums in 2011. During the review period (2008–2012), the life insurance industry in Ireland went through difficult times and was impacted by the global financial crisis and eurozone debt crisis. The introduction of several new regulatory provisions and austerity measures adopted by the government had an adverse impact on consumer confidence. The gross written premium declined from EUR11.1 billion (US$16.3 billion) in 2008 to EUR10.2 billion (US$14.1 billion) in 2012, at a CAGR of -2.3% over the review period. Insurance brokers led the Irish life insurance segment during the review period and accounted for a 45% share of the total market commission in 2012.
Factors such as the country’s aging population, reforms in pension law and insurers’ efforts to minimize cost and enhance efficiency in terms of writing new business and product innovations are expected to drive growth in the Irish life insurance segment over the forecast period (2012–2017).
Changing demographics of the Irish population
Ireland’s aging population was an important driver for the life insurance segment during the review period and this is expected to continue over the forecast period. According to World Bank statistics, the population aged 65 years and over rose from 11.3% of the overall population in 2008 to 12.1% in 2012. According to the Irish Department of Health report in 2011, the average life expectancy for Irish men is 76.8 years and 81.6 years for women, compared to the average ages of 64.5 and 67.1 years in 1950. The increase in an elderly population will contribute to the growth of retirement-related life insurance products such as pension, annuity and superannuation coverage.
Changes to pensions in Irish Budget 2013 will support growth
The Irish government, through Budget 2013, continues to provide tax relief for pension contributions at the marginal rate of income tax, which is currently at 41%. This will provide an incentive for the middle income group to save for retirement. The capping of the pension benefit at EUR60,000 per annum (US$79,176), rather than disposing of the tax relief on pension contributions, provided relief to the life insurance segment. An individual will also now be allowed to withdraw up to 30% of the value of funded Additional Voluntary Contributions (AVC) made to supplement retirement benefits. The above development in the pension market has provided clarity on the Irish government’s pension policy and will support future growth in the life insurance segment.
Consolidation anticipated in an already concentrated life insurance segment
The Irish life insurance segment is highly concentrated, with the country’s five leading insurers accounting for a collective market share of 85.2% in 2009. Further consolidation is anticipated over the forecast period as a result of the enduring impact of the European debt crisis and the forthcoming implementation of the EU’s Solvency II directive. Most notably, Solvency II regulations are expected to force many smaller companies to merge with larger ones in order to achieve the required level of solvency.
Factors such as the country’s aging population, reforms in pension law and insurer efforts to minimize cost and enhance efficiency in terms of writing new business and product innovations are expected to drive growth in the Irish life insurance segment over the forecast period.
The Irish government, through Budget 2013, continues to provide tax relief for pension contributions at the marginal rate of income tax, which is currently at 41%. This will provide an incentive for the middle income group to save for retirement.
The Irish life insurance segment is highly concentrated, with the country’s five leading insurers accounting for a collective market share of 85.2%.
The Irish life insurance segment was the 14th largest in Europe and accounted for 1.4% of the total European life gross written premiums.
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