Reduced claims and claims cost help insurers in recessions

The Economist newspaper is predicting insurers will thrive in the recession.

It says: “People drive less, reducing the number of motor accidents. The industries that often shrink most in a recession—construction and manufacturing—are among the most dangerous for workers. That means fewer payouts for insurers that have written protection against injuries. And for commercial and industrial property, though damage to premises rises, the cost of finding alternative facilities is lower.”

It quotes Allianz’s Andrew Torrence, the US Insurance Information Institute and Munich Re.