Australia Life Insurance Market
Despite its geographical proximity, the Australian life insurance industry bears little resemblance to the other markets. It is well established, having matured over the past 15 years, and remains relatively small, with US$31.2 billion of sales in 2007. Australian insurers have not connected more with the rest of Asia due to a history of poor expansion outcomes and ongoing fears about regional fundamentals, including fallout from the Asian financial crisis of the late 1990s.
Although there are few growth prospects remaining in Australia, we are cautiously optimistic about the future of the industry. In particular, there are opportunities to more effectively extract value from the risk and savings needs of Australian consumers. For example, there are many unmet risk management needs that must be addressed, such as longevity and morbidity risk, that have been opaquely transferred from government to individuals over the last 20 years or so.
