Strong balance sheets for 2007, Swiss Re predicts

Year 2007 promises to be profitable for the insurance industry, experts at Swiss Re’s recent economic forum predict. “Balance sheets of most non-life insurers are very strong going into 2007 and we expect this to improve in 2007,” said Thomas Hess, chief economist at Swiss Re’s forum.A key to sustaining the profits “will be for the insurance industry to remain disciplined towards competition and pricing,” Hess said. He attributed the strong end to 2006 to few catastrophe losses, double-digit profits and renewed investor interest in insurance stocks.Challenges beyond 2007 may include a number of trends that represent significant growth opportunities for insurers, including the rising importance of the emerging markets and developments due to globalization, a Swiss Re press release says.”However, the industry must be ready to respond with appropriate products and fix the structural challenges it faces in terms of improving its profitability, including moving to a lighter capital model,” the release says. Swiss Re’s Economic Forum was held in London, U.K. in December.