Swiss Re Chief Economist Jerome Haegeli has said the insurance market has a golden opportunity to drive the ability of the world economy to “build back better”.
As he delivered the reinsurer’s global economic outlook Mr Haegeli said the industry had more opportunities then challenges although warned the global economy had the potential to still deliver a range of shocks.
He warned that the level of financial stimulus delivered by states across the world outstripped the levels of any other crisis since the second world war and warned that such stimulus rarely if ever drive sustainable growth.
“When we talk about building back better for the global economy, we need to look at a range of actions,” he explained.
These were building greater macro resilience, improve long term growth and improve societal outcomes.
As some of the world’s leading investors insurers had the ability to drive the growth in sustainable infrastructure, enhance the digital economy and drive the transition to a low carbon economy.
While COVID has had a huge effect on the global economy Mr Haegeli warned the threat of climate change delivered a far more challenge long term threat.
“COVID-19 has an expiry date, climate change hasn’t,” he explained.
For insurers he said the market had seen a V shaped recovery with premium growth exceeding the projections for this year. However, he warned the low interest rate environment still had the potential to threaten the market’s recovery.
However, emerging market growth will continue in the year ahead with China leading the way, he said.
“There are opportunities for the industry,” he explained. Indeed, there are more opportunities then challenges as we see it.
“The move to digitalisation, and a rising risk awareness both from the pubic and governments has been seen as a result of the COVID pandemic, coupled with the growth in emerging markets are reasons that we can be positive.”
He said the insurers needed to play a part in shaping the future global economy as it looked to reset following the pandemic.
“We have the opportunity to see a real greening of the economy,” said Mr Haegeli. “Now is the time to drive greater resilience in the global economy.
“Insurers can make a difference as some of the world’s biggest long-term investors, and in our role as the underwriters of the world’s risks.”