The Dutch economy saw 4% growth in 2021 as the country began to recover from COVID-19. Hot on its heels is the country’s general insurance industry, which is set for growth of 3.7% by the end of 2021, according to GlobalData. Looking ahead, the leading data and analytics company forecasts the sector to grow at a compound annual growth rate (CAGR) of 4.5% – from $72.08 billion (€63.1 billion) in 2020 to $98.38 billion (€78.68 billion) in 2025.
Rakesh Raj, Senior Insurance Analyst at GlobalData comments: “The Dutch economy declined by 3.8% in 2020 due to COVID-19 containment measures, which resulted in a strong decline in disposable income. The resumption of economic activities, successful COVID-19 vaccination rollout programs, and a favorable regulatory environment are expected to support the general insurance industry in the Netherlands, although the speed of recovery remains uncertain with recent news of new nationwide lockdown measures being introduced in The Netherlands to curb the spread of Omicron.”
Raj reviews different segments of the general insurance industry and offers his views on the emerging trends:
Personal accident and health (PA&H)
PA&H Insurance is the largest segment in the Netherlands’ general insurance industry, having accounted for 83% of the gross written premiums (GWP) in 2020. The segment grew by 3.6% in 2020 driven by the country’s hybrid social health insurance system, where private insurers play a vital role in providing mandatory healthcare to all citizens.
Raj continues: “More than 85% of the population has opted for voluntary insurance through private insurers to cover a range of services that are not covered by statutory insurance, with increased health awareness due to the pandemic benefiting the segment in 2020.”
Increased digitalization by Dutch insurers during the pandemic also benefited the PA&H segment in 2020. This includes new digital service-based products, telemedicine, video visits, and remote patient monitoring.
Raj adds: “Easing regulations for digital services has provided greater flexibility to insurers to introduce new communication solutions and payment schemes that will help in the wider adoption of digital products.”
Motor insurance is the second largest segment in the general insurance market in the Netherlands’, having accounted for 7.5% of the total market in 2020. The segment registered lower growth of 1.9% in 2020, compared to 7.4% growth in 2019, due to a decline in new vehicle sales.
Raj continues: “Motor insurance is forecast to grow at a CAGR of 4.8% between 2020-2025, driven by both a recovery in automobile sales and a governmental push towards expanding the electric and hybrid car market in an effort to achieve 100% emission-free traffic by 2030.”
Property insurance accounted for 5.7% of the Netherlands’ general insurance GWP in 2020. The segment grew by 2.4% in 2020, as compared to 4.3% growth in 2019, following a decline in the construction and manufacturing sectors. It is expected to recover with forecast growth at a CAGR of 3.6% between 2020-2025.
Raj adds: “Growth in the property insurance market is expected to be driven by investments in the vibrant housing market and a strong manufacturing sector.”