Taiwan’s insurance penetration tops the world: statistics
Taiwan’s insurance penetration of 18.9 percent ranks No. 1 in the world, showing insurance products’ great popularity among the public, according to statistics released by the government.
The insurance penetration rate measures the share of insurance revenues in the overall GDP in a country. Hong Kong and South Korea, with a rate of 12.4 percent and 11.3 percent, rank No. 2 and No. 4, respectively.
The insurance industry raked in US$95.6 billion last year, making Taiwan the 11th most profitable place for the insurance business, said the Directorate-General of Budget, Accounting and Statistics (DGBAS, ).
The U.S. and Japan have higher insurance revenues of US$1.28 trillion and US$ 479.8 billion, respectively, but their insurance penetration is not as high as Taiwan’s.
Insurance penetration is influenced by the national income level as well as the types of insurance purchased, according to the Life Insurance Association of the R.O.C. ( ).
The endowment insurance and the variable life insurance usually require higher payments, resulting in greater purchased insurance, the Life Insurance Association said, adding that Taiwanese consumers prefer the endowment policy.
The nation’s insurance density of US$4,072, which is the average per capita insurance expense, ranks No. 9 globally, the DGBAS said. Sweden’s US$4,027 takes the top spot.
Insurance density is a derivative of national income level and the amount of insurance purchased, the Life Insurance Association said, adding that developed nations tend to have higher density than developing nations.
A higher density indicates a superior understanding of insurance concepts, while a lower rate signifies greater untapped opportunity for the business, the association added.
The nation’s finance and insurance industry has realized much growth and logged record earnings in recent years. The property and life insurance sector grew 5.1 percent in revenues in 2014, substantially higher than the nation’s GDP growth.