(MENAFN Press) The Portuguese personal accident and health insurance segment registered a decline in gross written premium terms, at a CAGR of -2.6% during the review period (2007’2011). The segment accounted for 10.9% of the industry's total written premium in 2011.
The decline was attributed to the country's weak economic development and the ongoing sovereign debt crisis in EU member states.
The growth was further discouraged by the declining number of international travelers from Portugal and therefore a weakened demand for travel insurance products during the review period.
Moreover, the presence of national and state-run universal health insurance schemes decelerated the growth of private insurance policies.
The Portuguese government took decisive actions and introduced an economic stimulus package to spur country's economy and improve its macroeconomic fundamentals.
Health insurance is likely to increase its dominance
The health insurance category is expected to further increase its dominance over the forecast period (2012’2016). In 2011, the health insurance category accounted for 43.6% of the segment, while the personal accident category accounted for the largest share of 45.8%, and travel insurance category accounted for 10.6%.
The health insurance category's share is expected to reach 53.8% in 2016 and be driven by increasing medical expenses and improving macro and micro-economic fundamentals.
An underpenetrated market provides opportunities for insurers
Despite the fact that medical expenses are rising and government funding is decreasing, private health insurance still remains underpenetrated.
Portugal's private insurance market covered only 10.2% of the total population in 2011, and the segment's penetration as a percentage of GDP stood 0.68% compared to Austria's 0.87% and Spain's 0.72% in 2011.
Such a low penetration level indicates positive growth potential is awareness of the products can be raised.
Increasing number of international travelers to spur demand for travel insurance policies
The number of outbound tourists from Portugal declined from 1.64 million in 2007 to 1.6 million in 2011 as a result of the global financial crisis in 2009 and high levels of unemployment recorded during the review period.
However, economic and business conditions are gradually improving and it can therefore be expected that the Portuguese will make overseas trips for personal and business purposes over the forecast period.
The number of international travelers is anticipated to increase from 1.6 million in 2011 to 1.8 million in 2016, at a CAGR of 2.6%. The projected volume of international travelers is likely to drive the travel insurance category over the forecast period.
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