But what does this involve? Many insurers develop products tailored to customers’ needs. While this is a key component, it is not enough on its own. The chances of success are higher the earlier the industry gets involved: people in emerging economies tend to take out insurance only once financial services become part of their everyday lives. This requires, above all, broad access to financial services, greater awareness of the value of insurance, and confidence in public institutions. Local insurers can actively help shape these developments by engaging with policymakers, advocating for a stable regulatory framework, cooperating with banks and microfinance institutions, and supporting their evolution. This creates solid ground for new insurance growth markets to emerge from and grow step by step.

Tarik Aouad, Head of the International Growth Markets Division at Deutsche Rück, takes a global approach: “We support our clients in international growth markets and aim to bring together experience from different regions,” he says. “Practices that are already well established in one market can provide valuable impetus in another. Combined with local expertise, disciplined underwriting and long-term partnerships, this creates lasting value for our clients and for Deutsche Rück alike.”

Asia: Digitalisation sets the pace 

The starting conditions vary from one region to another. In many parts of Asia, financial and insurance markets are currently growing particularly rapidly. Digital identity solutions and mobile payment systems have already given millions of people access to financial services for the first time. “Many Asian countries have the great advantage of being able to build their insurance markets on a digital foundation from the outset,” explains Aouad. “Digital identity solutions, mobile payment systems and data-driven underwriting not only improve efficiency, but also make insurance more accessible and affordable for millions of people.” Younger generations now take digital services for granted, for example. 

Latin America: New customer segments emerge 

The market is also undergoing significant change in Latin America. In 2025, the international consulting firm McKinsey even ranked Latin America as the world’s fastest-growing and most profitable insurance market. Brazil, Mexico, Chile and Colombia are leading the way. Property and casualty insurance, particularly property and accident insurance, is currently seeing the strongest growth. At the same time, demand for health insurance is increasing, driven by a growing middle class. Many consumers are discovering insurance as part of their everyday financial lives for the first time.

But before people can take out an insurance policy, certain prerequisites must be in place. “In Latin America, above all, people need a better understanding of the benefits of insurance, clear rules and deep-rooted trust,” says Dr Mariana Vilmondes, designated Head of the Latin America Market in Deutsche Rück’s International Growth Markets Division. Only then will new customer segments and stable market structures gradually emerge.

North Africa: Cultural values shape the market 

The insurance industry in North Africa is also on a steady growth trajectory. Morocco plays a key role, says Laurent Beauregard, Market Head for France, Belgium, Luxembourg and the Maghreb at Deutsche Rück subsidiary DR Swiss: “The country is positioning itself as Africa’s financial hub through its modern Casablanca Finance City and is becoming increasingly attractive to international investors.”

However, cultural values shape the market more strongly in North Africa than elsewhere. “Muslims are often sceptical of life insurance because they view it as a gamble on life that is incompatible with their faith,” explains Beauregard. But attitudes are changing: “Gradually, people are recognising the benefits of life insurance with a savings component – they can save while at the same time providing financial protection for their families in the event of death.” 

Regardless of how far individual markets have progressed, one thing is clear: A bank account, basic financial literacy and regulatory credibility are essential prerequisites for further developing the insurance business. Only on this foundation can insurance solutions tailored to people’s needs succeed.

Prerequisite 1: Infrastructure – enabling access 

According to a World Bank survey published in 2025, 79 percent of adults worldwide now have an account with a bank or a mobile payment provider, compared with just 51 percent in 2011. However, there are significant differences between regions. In Europe, almost all adults use banking services. Many Asian countries also report rates of more than 80 percent. By contrast, only around 60 percent of adults in Latin America have access to formal financial services, while in North Africa the figure is often less than half. Without access to basic payment services, access to insurance remains out of reach. 

India’s Pradhan Mantri Jan Dhan Yojana programme, launched in 2014, provides a striking example of how political determination can transform financial inclusion. The government introduced fee-free accounts with no minimum balance requirement, giving people easy access to government-backed insurance and loans. Within just a few years, more than 500 million new accounts were opened, many of them by people who were interacting with the financial system for the first time.

Such measures set a broader development in motion: “More and more people are learning how to use financial products and gradually building up a financial track record,” explains Aouad. “Digital services also bridge vast distances and reach people in remote areas.” Over time, this builds trust in financial products – and, with it, the willingness to take out insurance. 

Prerequisite 2: Financial literacy – understanding risk  

Access to financial services alone is not enough. Equally important are educational initiatives that help people understand financial concepts. For example, through its foundations, the Savings Banks Finance Group supports local financial institutions in Latin America in their professional development, facilitates access to financial services for small and medium-sized enterprises, and provides financial education programmes for the public. Dr Mariana Vilmondes explains: “People in Latin America can only make informed financial decisions and manage their money effectively if they have a basic understanding of financial matters.” 

The better people understand risks, probabilities and their own financial resilience, the more likely they are to recognise the value of insurance. “Local insurers also have an important role to play in raising general awareness,” emphasises Dr Vilmondes. As long as insurance policies appear complicated, they discourage many people. By contrast, when insurers explain their products clearly and in relatable terms, trust grows and people become more willing to take out insurance.

Prerequisite 3: Regulation – providing security

Trust in banks and insurers is built not only down to people, but also reliable regional regulators. In countries where regulators and policymakers promote transparency and inspire confidence, the insurance market is growing strongly.

Morocco is a good example: The regulatory authority ACAPS has introduced a digital claims management platform, which connects policyholders with insurers, speeds up claims processing and enables policyholders to track the status of their claims at any time. “This sends a clear message: insurance works here,” explains Beauregard. “It also gives people with little previous experience of formal protection confidence in the system.”

‘AI is not a standalone risk – it is a cross-cutting technology.’

The challenge for underwriters is summed up by Daniel Hernandez, Senior Underwriter, Facultative Property Business and Property Line Management at Deutsche Rück: “AI is not a standalone risk – it is a cross-cutting technology. The real danger for insurers lies not in individual AI applications, but in the unrecognised aggregation of risk within existing covers.”

The risk is often hidden because AI is embedded in machinery, buildings, control systems and supply chains. However, the consequences can be very tangible when the resulting loss manifests itself in traditional physical forms, such as production downtime, system malfunctions or fire damage. As the underlying cause is often software-based, the boundaries between property, cyber and product liability risks can become blurred. In addition, there is a significant accumulation risk arising from globally deployed AI models, shared cloud infrastructure and common software libraries.

‘Silent AI’ as a new structural risk arising from change

The question is to what extent these risks are covered under existing policies. This draws parallels with cyber insurance and silent cyber risks. Silent risks are risk exposures within existing insurance covers that are neither explicitly modelled nor clearly addressed in policy wordings, but which may arise as a result of technological, regulatory or societal change. Silent AI is now emerging as a new structural risk, driven by the increasing use of AI by policyholders. 

In the case of silent cyber risk, conventional policies have excluded cyber risks in some cases. The US market is already seeing similar discussions around Silent AI. However, exclusions for AI risks remain rare in Europe – at least for now. “Primary insurers must now recognise the strategic significance of Silent AI and review their portfolios for potential AI-related risks,” says Hernandez.

Risks associated with modern ‘smart buildings’ and predictive maintenance

Two examples illustrate where the risks associated with embedded AI in industry may lie, from an insurer’s perspective. Modern smart buildings use AI to control heating, ventilation, lighting, and security systems. Using sensor data, these systems analyse occupancy patterns, energy consumption and climate data, enabling them to make autonomous decisions. Access control systems are enhanced by image recognition, while security cameras analyse movement patterns in real time. 

These systems significantly improve efficiency and convenience. At the same time, however, they create new dependencies. Faulty decisions or technical malfunctions can affect fire protection, building safety and operational processes – thereby becoming an insurance risk. 

Another example is predictive maintenance. Instead of inspecting machinery at fixed maintenance intervals, AI systems continuously analyse sensor data, such as vibration, temperature and power consumption. Based on historical data, the software calculates the optimal time for maintenance and predicts the remaining service life of individual components.

But what happens if the prediction is wrong? Who is liable if an algorithm fails to detect a critical defect? And how does the probability of loss change when companies rely entirely on AI models to determine their maintenance strategies? To date, such questions have been difficult to answer using historical claims data.

Reinsurance for a country in ruins  

Of the 43 public insurers, only 24 survived the Second World War. They all faced the same challenge: Individually, they were too small to bear major fire and natural catastrophe risks on a lasting basis. This was because the nationwide risk-sharing arrangements that had existed before the war had collapsed, forcing them to reorganise. The answer was not an individual solution but a collective one: a dedicated reinsurance company backed by all public insurers. On 22 August 1951, “Deutsche Rückversicherung Aktiengesellschaft” was founded in Bernkastel-Kues on the River Moselle. Its founding mission continues to shape the company to this day.

Growing alongside the public insurers  

After its establishment, Deutsche Rück wasted no time in commencing operations in Hamburg, initially as a subtenant of Hamburger Feuerkasse, occupying just two offices with a staff of only five. The company later moved to its first dedicated office building on Hamburg’s Outer Alster. The 1950s and 1960s were a period of growth for Deutsche Rück. Its growth was driven not by outpacing its shareholders, but by growing alongside them. The post-war reconstruction, the construction boom and the strong position of the public insurers in their core business of building insurance were all directly reflected in Deutsche Rück’s reinsurance business.

Trials and tribulations are part of history 

One of the first major tests for the public insurers – and therefore also for Deutsche Rück – was the North Sea flood of 1962. The public insurers were, and to a large extent still are, the market leaders in homeowners’ insurance in Germany. As a result, dealing with natural hazards became part of Deutsche Rück’s DNA from an early stage.  

The first and only crisis in the company's history  

At the beginning of the 1970s, heavy fire losses and rapidly rising inflation placed an increasing strain on Deutsche Rück's balance sheet. The 1973 oil crisis compounded the situation, bringing the economic upswing to an end and plunging the German economy into recession. For the first time since its founding, Deutsche Rück’s premium income declined. 

The thinking was that expanding into international business would not only provide better risk diversification, but also stimulate growth. Deutsche Rück therefore entered the London market. While this delivered growth, it also brought business that generated substantial losses. The asbestos and liability crises of the late 1980s, together with the notorious London reinsurance spiral, only made matters worse. Then, at the beginning of the 1990s, losses from the international business were compounded by the heaviest series of storms Germany had experienced up to that point. The result was the largest – and ultimately the only – crisis in Deutsche Rück's history.

Well conceived – poorly executed

Looking back, it is clear: The internationalisation strategy was sound in principle – but poorly executed. The company lacked experience in these markets, some of its partners proved problematic, and it had assumed risks that it was unable to fully assess. One important lesson ultimately paved the way for future success: Diversification works only if you truly understand and can accurately assess the new risks involved. 

A collective rescue effort  

What proved decisive for Deutsche Rück’s future was not the crisis itself, but the response to it. In 1993, a collective rescue effort by all public insurers saved Deutsche Rück and enabled it to overcome the crisis. Its UK operations were discontinued, and the company withdrew completely from active international business. 

From the Elbe to the Rhine  

The crisis became a turning point – and laid the foundations for the Deutsche Rück we know today. The company had to reposition itself – both strategically and in terms of its business focus. In 1989, Deutsche Rück moved from the Elbe to the Rhine. Düsseldorf was increasingly becoming the centre of the public insurers’ supra-regional activities. There, together with the two associations representing the public insurers that still existed at the time, it pooled resources and formed an integrated management and administrative organisation.  

At the same time, the market underwent fundamental change: The deregulation of the EU single market in the mid-1990s suddenly intensified competition among primary insurers. The public insurers had to reposition themselves – and needed greater support to do so. This enabled Deutsche Rück to redefine its role: no longer merely as a risk carrier, but as a genuine partner to the public insurers.

Developing expertise  

The devastating series of winter storms in 1990 once again highlighted the scale of the threat facing the public insurers. A key element of this strategic repositioning was therefore the development of expertise, particularly in the field of natural hazard modelling.  

At the beginning of the 1990s, analyses of natural hazards were still relatively imprecise and offered only limited geographical detail. With the establishment of its new NatCat Centre, however, Deutsche Rück began to analyse storm, flood and earthquake risks at regional level in an increasingly systematic and detailed way, incorporating the results into its risk assessments – pioneering work for its time.

The idea behind it: Not merely to pay claims, but to gain a better understanding of risk – making it more quantifiable and therefore more manageable. Today, this expertise is inseparably linked with the Deutsche Rück brand in Germany. 

Prudent diversification  

Building on this foundation, Deutsche Rück cautiously re-entered the international reinsurance market. In 2000, Deutsche Rück established its subsidiary, DR Swiss, in Zurich. This marked the first modest step in its renewed international expansion. Since then, Deutsche Rück has remained committed to two key strategic principles: underwriting only those risks it understands and can assess properly, and generating the capital required for expansion from its own resources.  

From Düsseldorf to the world  

In 2005, Deutsche Rück took its next step on familiar ground. It expanded its market presence in Germany, Austria and Switzerland.   

In 2009, it entered the markets of Central and Eastern Europe. There, Deutsche Rück operates as a following reinsurer in its core Property & Casualty business.

Over the past five years, it has also successfully expanded its presence in the fast-growing markets of the Middle East, Asia and Latin America. Since 2024, Deutsche Rück has also been writing life reinsurance business successfully in the MENA (Middle East and North Africa) region. 

Active in 80 Countries

In its anniversary year, Deutsche Rück is active in around 80 countries worldwide. Its history clearly demonstrates what the company stands for today – and will continue to stand for in the future: It is a medium-sized company that has successfully combined tradition with innovation, fosters partnerships with its clients on an equal footing, consciously builds long-term relationships, and is committed to disciplined underwriting, active risk management and clear portfolio management – independent of the capital markets and with the public insurers as reliable and stable shareholders.