Australia's general insurance sector set to hit $96b by 2029

The market is seen to reach $67.4b next year.

Australia’s general insurance sector is projected to reach $95.7b in 2029, generating a compound annual growth rate (CAGR) of 9.2% from 2025, according to GlobalData.

Meanwhile, the industry is seen to bag $67.4b in 2025, growing by 8.9%, thanks to a rise in vehicle sales, growing demand for policies covering extreme weather events, and increasing premium prices across general insurance lines due to high inflation.

Personal Accident and Health (PA&H) insurance was the largest segment in 2024, accounting for 34.2% of premiums. It grew by 7.2% last year, supported by greater demand for private health insurance. 

The Australian Prudential Regulatory Authority (APRA) reported an increase of 64,000 Australians securing hospital treatment cover in the June 2024 quarter. Rising medical costs, which climbed 5.6% from January to September 2024, according to the Australian Bureau of Statistics, contributed to higher health insurance premiums. 

PA&H insurance is expected to grow at a CAGR of 4.5% from 2025 to 2029.

Property insurance, the second-largest segment with a 25.8% share in 2024, grew by 15.4%, driven by demand for natural catastrophe coverage amid an increase in extreme weather events. 

Infrastructure development is also expected to boost this segment, with government spending projected to reach AUD270.4 billion by 2028. 

Property insurance is forecast to grow at a CAGR of 13.3% from 2025 to 2029.

Motor insurance, accounting for 25.6% of premiums in 2024, recorded 12.6% growth last year, supported by a 6.5% rise in new car sales during the first half of 2024, according to the Federal Chamber of Automotive Industries (FCAI). This segment is projected to grow at a CAGR of 12.7% from 2025 to 2029.

Marine, aviation, transit (MAT), liability, financial lines, and other general insurance categories contributed the remaining 14.4% of the market in 2024.

Whilst strong growth is anticipated across the industry, challenges remain. 

“The Australian general insurance industry is set to experience consistently high growth over the next five years. However, increasing claim payouts due to rising inflation and an increase in losses due to frequent nat-cat events will remain a significant challenge for general insurers,” GlobalData's senior Insurance analyst, Sneha Verma, said in the report.