Insurance in emerging markets: determinants of growth and the case of climate change?

Date: 21 Nov 2012
Venue: London School of Economics and Political Science (LSE)

The ‘LSE/MR Symposium on Insurance in Emerging Markets’ brought together a small group of leading academics and practitioners to discuss the different determinants of insurance growth.

The aim was to have an open exchange on latest findings, considering evidence from emerging markets and developed markets, as well as comparing tools and methods for evaluation.

Over the past decade, growth in insurance demand in the emerging economies has been a key driver of global non-life premium growth. Current forecasts suggest that these markets will continue to be areas of significant growth over the coming decade. Although several studies (for example Feyen et al. 2011; Enz 2000; Zheng et al. 2008, 2009) have found that one of the most significant historical drivers of non-life insurance demand in emerging economies is income per capita, this alone cannot wholly explain the long-term evolution of insurance penetration at a country level.

As part of the LSE/MR research programme on ‘Evaluating the Economics of Climate Risks and Opportunities in the Insurance Sector’ we have explored the major determinants of the demand for insurance in the context of climate change.

Ranger and Surminski (2011) suggest five pathways of influence: economic growth; willingness to pay for insurance; public policy and regulation; the insurability of natural catastrophe risks; and new opportunities associated with adaptation and greenhouse gas mitigation.

The symposium provided an opportunity to present the findings under the LSE/MR research programme, while inviting a discourse on how best to link the topic of climate change with general insurance economics.

The event follows the tradition of earlier academic symposia held as part of the LSE/MR programme, facilitating a dialogue between practitioners from the industry and the academic world.

Date and location: 21 November 2012, LSE, London

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