Record Earnings for Europe’s Primary Insurers in 2024
According to a comprehensive analysis by Moody’s, a renowned global credit ratings and risk assessment firm, the top four primary insurers in Europe—Allianz, AXA, Generali, and Zurich Insurance—have achieved unprecedented earnings in the fiscal year 2024. Together, these insurance giants have amassed a remarkable €28.6 billion in combined earnings, marking a significant 15% increase from the prior year.
Moody’s attributes this remarkable growth to robust performances across all major divisions, with notable contributions from both the property and casualty (P&C) and life and health (L&H) insurance sectors.
Key Drivers of Growth
The P&C insurance sector saw a robust 9% increase in premiums, while the L&H segment experienced a substantial 14% growth. These gains were largely due to strategic price adjustments and increased market exposure, especially in the retail insurance domain. In particular, the L&H sector benefited from a surge in new business sales and a decline in policy surrenders, most notably in countries like France and Italy.
While the insurers surpassed their earnings targets for 2024, Moody’s projects a more tempered growth trajectory for 2025, citing rising geopolitical risks and market uncertainties as potential challenges.
Performance Highlights
The P&C business was a standout performer in 2024, bolstered by both retail and commercial insurance lines. Notably, premium revenue in retail insurance significantly enhanced underwriting results as companies continued to adjust pricing in response to inflationary pressures on claim costs. Both Allianz and Zurich reported improvements in their commercial combined ratios, although there were indications of a slowdown in commercial pricing momentum in certain markets. Despite this, the retail P&C lines demonstrated significant improvement across most European regions.
In the L&H sector, there was a notable rebound in 2024, following a slower year in 2023. This resurgence was driven by higher releases from the contractual service margin (CSM) and enhanced technical margins. The protection and health insurance markets, in particular, performed exceptionally well, with AXA reporting a significant turnaround in its UK health insurance business. Although some volatility was noted due to economic factors like widening sovereign credit spreads, the overall trend for L&H remained positive.
Future Outlook
Looking ahead to 2025, Moody’s forecasts slower profit growth, with P&C performance expected to continue benefiting from price hikes and exposure increases. However, the commercial pricing momentum is anticipated to decelerate. Additionally, the movement towards shorter-term contracts in the L&H business, particularly for AXA and Zurich, could constrain CSM growth. In contrast, Allianz and Generali, with their emphasis on long-term life savings, appear better positioned for sustained growth in this area.
Despite these challenges, Moody’s remains optimistic about the insurers’ potential for further market share expansion. Their diverse portfolios, robust capital management strategies, and extensive geographical reach provide a solid foundation for future growth. Moody’s also highlighted the importance of geographical diversification in reinforcing these insurers’ market positions.
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