Non-life insurance premium growth should improve in 2016 and 2017, with emerging markets driving the charge, Swiss Re said in its annual insurance outlook.

Emerging markets will generate property/casualty premium growth of 8 percent to 9 percent over the next two years, Swiss Re said.

“Emerging markets are the growth engines for the insurance industry – and this is expected to continue for at least several years more,” Swiss Re Chief Economist Kurt Karl said in prepared remarks.

Premium gains in the developed world will pale in comparison.

In the U.S., for example, Swiss Re. predicts non-life premium growth of 1.8 percent in 2016, and 1.3 percent in 2017, after growing an estimated 3.8 percent in 2015. Japan should generate 2.8 percent in premium growth in 2016 and 1 percent in 2017, according to Swiss Re’s report.

Overall, advanced markets (including North America, Western Europe, Japan, Korea and Taiwan) will produce 1.8 percent in premium growth during 2015 and 1.7 the year after. Emerging markets, in contrast, will see 7.9 percent in premium growth through 2016 and 8.7 percent in 2017, Swiss Re predicted.

What will drive this growth?

Swiss Re said that a “moderate strengthening” in global economic growth over the next two years will, in turn, support insurance growth. As well, reinsurance catastrophe property rate softening should moderate beginning in 2016, thanks, in part, to continued low natural catastrophe losses.

Global economic growth is not guaranteed, however. Swiss Re noted three potential obstacles to global economic growth: slow growth in China, lower commodity prices and the likelihood that the Federal Reserve will increase rates.

Source: Swiss Re