What countries will be most profitable for life insurers? United States still tops the list but China is nipping at its heels.
These findings were published in McKinsey & Company’s report Life Insurers and Annuities State of the Industry 2018: the growth imperative. The gap between the two countries is $6 billion, as the table below shows:
Asia will host 2/3 of the middle class in 2030
When will China surpass the US? McKinsey does not say.
All the same, the consulting firm predicts that by 2030, two-thirds of the people who make up the middle class will be living in Asia. About 20% of the global middle class will reside in Europe and North America. In 2010, these two continents were home to half of the middle class population.
“This massive population shift is a major driver of the differences in growth rates between the regions,” the McKinsey analysts add.
Number of millionaires in US rising
The middle class may not be growing in the United States, but the millionaire segment is on the rise, McKinsey finds.
The consulting firm says that the number of American households with over $25 million in assets climbed 10% between 2015 and 2017. In 2018, the number of millionaires grew by 700,000 households. “In addition, Fidelity announced that the number of millionaires in its retirement accounts had tripled in the past year, creating opportunities for insurers to develop specific value propositions for those segments,” McKinsey says.
Coming next Wednesday: As the population ages, life insurers face an uphill battle with investment firms.