Within the services sector, finance grew particularly strongly with value creation moving up approx. 11% per year on average from 2012 to 2016. Further structural change towards a knowledge- or ideas-based economy is being pursued not only in the IT, communication, pharmaceutical and banking sectors, but is also being influenced to a great extent by the insurance industry. China offers considerable catch-up potential. The insurance penetration rate (defined as premium volume as a percentage of GDP) of 4,2% (forecast for 2016) is far below the global average (ca. 6,2%). The Thirteenth Five-Year Plan published by the Chinese government in 2016 anticipates that the services sector’s share of GDP will increase to 56% by 2020. The Plan anticipates a premium target of CNY 4.5 trillion for the insurance sector, and market penetration of 5%.
On the basis of our forecast models, we also expect a significant increase in insurance penetration (see Tab. 1). Whilst average economic growth until 2020 is set to come in at just under 6%, for the insurance sector we predict average growth of almost 12% when adjusted for inflation (see Tab. 2). Experience has shown that people in countries with relatively low but rapidly increasing wealth by global comparison have a disproportionately increasing demand for insurance provision, e.g. for property covers or health costs. In addition, developing insurance markets like China are predestined to benefit from digitalisation. New distribution channels and business models are evolving, along with innovations in product development and claims handling. Newcomers in emerging markets can exploit these opportunities at an earlier stage than established insurers in mature markets.