Real life premiums in South Africa are estimated to grow by 2.6% in 2025 and forecast to slow to 1.7% in 2026 as falling long-dated government bond yields reduce the attractiveness of guaranteed annuities, according to a Swiss Re Institute (SRI) report.
In the report, titled “South Africa outlook: Opening pathways to greater resilience”, the authors said that even so, a gradual economic recovery, lower borrowing costs, and modest wage gains should support demand for protection covers and limit the downside. For 2027–2030, life premiums are predicted to grow at about 2% CAGR, helped by a growing middle class and the impact of reforms to formalise retirement saving, and improving preservation.
Life insurance dominates the South African market, with an 80% share of total premiums due to the popularity of investment-focused products. South Africa has an internationally active insurer base, supported by sophisticated “twin peaks” regulatory oversight. However, the market growth is constrained by weak economic conditions and affordability pressures.
South Africa has one of the highest life insurance penetration rates of any country globally (2024: South Africa 9.5% vs 1.9% in emerging markets and 4.1% in advanced markets). The high penetration rate is attributed to savings and investment-linked policies, which contribute nearly 70% of total life premiums. Demand for investment-linked life policies is concentrated among higher-income, formally employed households, while many low-income consumers buy funeral cover and informal savings (stokvels).
Overall, South Africa’s life insurance sector is the fourth largest of emerging markets, with a premium volume of $38bn in 2024.
Total (life and non-life) insurance market
South Africa has the fifth largest insurance market of global emerging economies, after only China, India, Brazil and Mexico. South Africa’s insurance market size at 21 globally.
Total insurance premium (ie, life and non-life) volumes in South Africa were about $47.8bn in 2024, up by 2.9% year-on-year in real terms.
The report says that total insurance market growth is estimated at 2.7% (real terms) in 2025, moderating to 1.8% in 2026 but still outpacing real GDP growth. The medium-term outlook (2027?2030) is positive, with real premiums expected to grow at a 2.1% compound annual growth rate (CAGR) backed by improving economic growth, an expanding middle class and regulatory reforms.
The writers of the report, all from SRI, are Ashish Dave, team lead IMA Bangalore; Mahesh H Puttaiah, head, Insurance Market Analysis; and Shambhavi Priya, insurance economist; and Swaraj Thakare, research analyst.