Education & Scholarships

Top Insurance Companies in the World and Why You need One

Written by waploaded

As many people have come to know the importance of insuring their lives, business, car, and many other things, the insurance business has been on rapid growth and center of attraction. Every day, people are faced with risks, some of which are hardly predicted or controlled. Risks like an accident, falling sick, being the victim of a natural disaster or fire, and, above all, the risk of life.

These risks come with pain and suffering. They most times become the victims of economic and financial hurt. Therefore it becomes wisdom to insure most areas of your life have greater risk exposure.

Getting insurance keeps you prepared against the worst situation and makes you risk-proof to most unforeseen events. Insurance shifts the burden of bearing losses from unpredicted disasters from you to the insurance company.

The purpose of this article is to look at some of the world’s top insurance companies. There are many criteria based on which such a list can be prepared: premium collections, revenue, profit, geographical area, assets, to mention a few.

Duties of Insurance

1. Insurance provides certainty of cover or backup for loss that was not planned for. The uncertainty of loss can be reduced by better planning and administration.

A saying goes that the only constant thing in all aspects of life is change. There is the uncertainty of events of time and amount of loss. Insurance removes the risky consequences of these uncertainties, and the assured is given the certainty of payment for the loss.

The insurer charges the premium for providing this shield. An assurance that once there is an event causing a loss, you will be paid a sum to cover the loss.

2. Risk-Sharing. Just as risk is uncertain, so is the loss arising from such risk. When risk takes place, the loss is shared by all the persons who are exposed to the risk. This is where insurance comes to place. Insurance absorbs the central part of the risk and holds the highest share.

Risk-sharing in ancient times was done only at the time of damage or death. Still, today, based on the probability of risk, (the share is obtained from every insured in the shape of premium without which the insurer does not guarantee protection.

3. It Provides Capital. The funds accumulated by insurance companies are invested into productive channels that provide capital for society.

The death of the capital of the society is minimized to a greater extent with the help of investment in insurance: the industry, the business, and the individual benefit from the investment and loans of the insurers.

The top insurance companies include

AIA Group Ltd

Founded in 1919 in Singapore with currently headquartered in Hong Kong, AIA Group is the largest pan-Asian life insurance group, with a presence in 18 different markets, including China, Australia, New Zealand, India, and Cambodia. It specializes in life insurance and other financial services.

As of Dec. 31, 2019, AIA was declared to have assets of $284 billion and a market cap of $126.2 billion as of February 5, 2020.

AIG

AIG, or American International Group, has offices which spread across 80 different countries. The company, founded in Shanghai in 1919, is currently headquartered in New York City. It mainly operates in three segments: general insurance (commercial and personal insurance), life, retirement, and a technology subsidiary called Blackboard Insurance.

AIG is one of the companies that received a bailout of $180 billion from the U.S. government following the 2007–2008 financial crisis. According to the Financial Crisis Inquiry Commission, credit default swaps were sold without collateral, causing AIG to fail.

The company has since recovered, reporting $525 billion in assets and a market cap of $45.2 billion.

AXA

AXA was founded in 1816 due to the merging of many insurance companies. AXA is one of the world’s leading insurance groups, with over 102 million customers in 56 countries and more than 125,000 employed. Its primary businesses are property and casualty insurance, life insurance, savings, and asset management. It has its headquartered in Paris but has a presence across Africa, North America, Central, and South America, Asia Pacific, Europe, and the Middle East.

AXA acquired 51% of the insurance operations of Colpatria Seguros in Colombia in 2013. It became the most prominent international insurer operating in China during the same year due to its 50% acquisition of Tian Ping (a Chinese property and casualty insurer). AXA also acquired the non-life insurance operations of HSBC in Mexico. The market cap for the AXA Group is currently around $67 billion.

China Life Insurance

China Life Insurance (LFC) is one of Mainland China’s most extensive state-owned insurance and financial services companies and a key player in the Chinese capital market as an institutional investor.

The company was founded in 1949 when the People’s Insurance Company of China (PICC) was formed. Its offshoot PICC (Life) Co. Ltd was created after parting ways with PICC in 1996. PICC (Life) Co. Ltd was renamed as China Life Insurance Company in 1999.

The China Life Insurance Company went through a restructuring in 2003 as China Life Insurance (Group) Company, which has seven subsidiaries. The businesses are spread across life insurance, pension plans, asset management, property and casualty, investment holdings, and overseas operations.

The company is open to the public on the New York Stock Exchange, the Hong Kong Stock Exchange, and the Shanghai Stock Exchange and is the most significant public life insurance company in terms of market capitalization globally. The company boasts a market cap of $123.9 billion.

ING Group

Dutch multinational ING Group was founded in 1991. The company provides a range of services, including retail, direct, commercial, and investment banking, insurance, and asset management. ING serves more than 37 million clients in over 40 different countries.

In 2018, ING announced a partnership with another member of this list—AXA. Together, the two have an exclusive, multi-country digital partnership to provide insurance products to clients online through a centralized platform. ING’s market cap is around $47.7 billion.

United Health Group

The UnitedHealth Group (UNH) is a very diversified health care business in the United States. It has two business platforms—UnitedHealthcare for health benefits and Optum for health services— which work together to serve over 115 million people in every U.S. state and 125 countries.

The UnitedHealth Group uses its experience and resources in clinical care to improve the performance of the health care services sector. The company’s market cap was $277.5 billion on February 5, 2020.

MetLife

MetLife, Inc. is the Metropolitan Life Insurance Company holding corporation, also known as MetLife, and its affiliates.

Serving more than 100 million customers in more than 50 countries and a market cap of $47.4 billion, and assets of $740.4 billion, MetLife is one of the world’s largest insurers. Also, it provides services in employee benefits and annuities.

The company has affiliates, including MetLife Investors, MetLife Bank—which was sold to GE Capital in 2013—MetLife Investment Securities, Metropolitan Properties Ventures, and Casualty Insurance Company.