Kathmandu. As the ageing population ages, life insurance companies need to shift their focus from traditional income replacement and family-oriented protection products to ‘estate planning’ and ‘personal care funds’.
According to Swiss RICO’s latest Sigma report, life insurance companies are expanding coverage models to meet those needs. “In Asia, cancer coverage targeted at older people in Thailand and Korea is linked to health or annuity plans,” the report said. ’
A Swiss Rico study found that by 2050, 27 percent of people in advanced markets will be over the age of 65. This will change the type of financial security that consumers need. “This silver economy will drive a new phase of innovation as insurance companies adapt to serve the older, wealthier and longer-lived generation,” the Swiss relay said.
In developed markets, the population aged 65 and over is expected to grow by 35 percent between 2025 and 2050. Jerome Jean Hegelly, chief economist at Swiss Re Group, said: “Longevity will affect both balance sheet risk and asset aspects. ’
Jerome said that as retirees reduce their savings, inflation and long-term interest rates could rise. “This will give good investment returns,” he said.
The Swiss Ricoh report said the insurance industry’s focus will shift from the accumulation phase to the disinvestment phase. “Where retirees will convert savings into sources of income through pensions and annuities,” the report said.
According to the report, by 2050, a 65-year-old person in developed markets can expect to live another 23 years. “This increases their risk of surviving beyond their savings,” the report said.
Swiss Reilly also expects growing demand for long-term care and health protection.
