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Nominal GDP USD bn 333.99Population mil 4.7GDP Per Capita USD 70,638Real GDP Growth % 7.8Inflation Rate % 0.3
Literacy Rate % n.a.Urbanization % 63.8Dependency Ratio % 53.8Life Expectancy Years 80.9Median Age Years 36.8
Insurance RegulatorPremiums Written (Life) USD mil 55,680Premiums Written (Non-Life) USD mil 8,626Premiums Growth (2016 - 2017) %
IrelandFranceGermanyItalySpainUnited Kingdom
CRT-2CRT-1
Country Risk TierCRT-2CRT-1CRT-1CRT-2
Vital Statistics 2017
Insurance Statistics
Regional Comparison
Central Bank of Ireland
United Nations Estimates
Source: IMF, UN, Swiss Re, Axco and A.M. Best
Regional Summary: Western Europe•WesternEuropeisahighlydevelopedandaffluentregion.
The 28 countries of the EU accounted for approximately 21.9% of the world’s domestic product in 2016 and 21.6% in2017,afigurethatisprojectedtogrowto22.5%in2018.
•Growth has been driven largely by rising domestic demand duetogrowingconsumerandbusinessconfidence,lowerunemployment rates, and credit growth.
•The European Central Bank (ECB) has decided to end its three-year EUR2.4 trillion quantitative easing program by the end of 2018, although it did signal that any rise in interest rates before September 2019 was unlikely. The policy rate has been below 1.0% since July 2012 and has been at 0.0% since March 2016.
•Concerns include political instability in certain countries, ongoing uncertainty about Brexit and its potential implications,andbelow-trendgrowthandinflation.
Economic Risk Political Risk Financial System Risk
Country Risk Tier 1 (CRT-1) Very Low Level of Country Risk
Country Risk Tier 2 (CRT-2) Low Level of Country Risk
Country Risk Tier 3 (CRT-3) Moderate Level of Country Risk
Country Risk Tier 4 (CRT-4) High Level of Country Risk
Country Risk Tier 5(CRT-5)VeryHighLevelofCountryRisk
IrelandCRT-2August 22, 2018Region: EuropeCountry Risk Criteria ProceduresGuide to Best’s Country Risk Tiers•TheCountryRiskTier(CRT)reflectsA.M.Best’s
assessment of three categories of risk: Economic, Political, and Financial System Risk.
•Ireland is a CRT-2 country, with low levels of economic andfinancialsystemriskandverylowpoliticalrisk.
•Ireland continues to grow above the European Union average. Its GDP in 2017 was 7.8%, driven by increases in domestic demand and exports.
•GDP growth in 2018 is expected to moderate due to ongoing uncertainty surrounding Brexit and rising trade concerns.
•A.M.Bestcategorizesthemajorityofcountriespicturedin the map as CRT-1 and CRT-2. The notable exceptions are the Eastern European countries of Bosnia and Herzegovina, Belarus, and Ukraine.
BEST’S COUNTRY RISK REPORT
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Palau
Pakistan
Oman
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Mexico
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Mali
Malaysia
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Finland
Fiji
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CanaryIslands
Azores
Reunion
Sumatra
Borneo
Taiwan
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Kuril Is
lands
NewGuinea
Tierra Del Fuego
South Georgia
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El Salvador
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East Timor
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Bulgaria
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Benin
Belize
Belgium
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Algeria
Albania
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Western Sahara(Occupied by Morocco)
Montenegro
Isle of Man
Jersey
Guernsey
Monaco
Gibraltar
Seychelles
Russia
Hong KongMacau
Russia
Indonesia
Guam
Northern Mariana Islands
Wake Island
Marshall Islands
Federated Statesof Micronesia
Nauru
Tuvalu
CoralSeaIslands
New Caledonia
Norfolk Island
French Polynesia
Pitcairn Islands
Kiribati
Tokelau
AmericanSamoa
CookIslands
Niue
Economic Risk: Low•The country’s economy is small and depends highly
on trade, which leaves Ireland vulnerable to external economic conditions—particularly to economic conditions in the eurozone.
•Irelandbenefitsfromflexiblelabormarkets,astablelegalenvironment, a young and highly educated workforce, and a mature regulatory environment.
•Ireland’slowcorporatetaxrateof12.5%hasbeenaprimary attraction for foreign companies and investment in the country. However, the country’s small size has been a deterrent for some foreign investors.
•Brexit could complicate Ireland’s economic forecast, given many Irish businesses’ close ties with Britain, and Britain’s status as one of Ireland’s main export destinations. However, some negative repercussions could be lightened by the relocation of UK-based businesses to Ireland.
Political Risk: Very Low•Ireland is a member of the European Union and one of the
original 11 countries to adopt the euro as its currency in 1999.
•The current prime minister of Ireland is Leo Varadkar of the Fine Gael party. He was elected in 2016. Varadkar leadsaminoritycoalition,withhispartywinning50oftheparliament’s158seats.Thelackofamajorityinparliamentmaymakeitdifficulttopasslegislation.
•Despitedramaticimprovementsincethefinancialcrisis,the political agenda remains dominated by economic policyandpublicfinances.
•Ireland should take measures to strengthen the Social Insurance Fund program, to ensure its viability. Pension and other social expenditures are expected to increase dramatically over the next couple of decades due to a rapidly aging population.
•Concerns over the implications of Brexit for the essentially invisible border between the Republic of Ireland and Northern Ireland are growing. Given the island’s history, the Irish government is keen to avoid a hard border between itself and Northern Ireland.
Financial System Risk: Low•The Central Bank of Ireland is responsible for the
authorization and prudential supervision of the insurance industry in Ireland.
•Non-performing loans are still high but are improving. Banksremainprofitableandhavestrengthenedtheirfinancialmetrics.However,theystillfacethechallengingeffects from lingering crisis legacies.
•The IMF has recommended close engagement with insurance companies to ensure their readiness for a potential change in the regulatory landscape due to the continued uncertainty surrounding Brexit negotiations.
Economic Growth (%)
-10
-5
0
5
10
15
20
25
30
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
Real GDP CPI Inflation
Source: IMF World Economic Outlook and A.M. Best
Political Risk SummaryScore1(best)to5(worst)
0
1
2
3
4
5International Transactions
Policy
Monetary Policy
Fiscal Policy
Business Environment
Labor FlexibilityGovernment Stability
Social Stability
Regional Stability
Legal System
IrelandWorld Average
Source: A.M. Best
Ireland
GDP Per Capita and Population
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20
30
40
50
60
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80
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0
10,000
20,000
30,000
40,000
50,000
60,000
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Ireland France Germany Italy Spain United Kingdom
USD
Millions
GDP Per Capita Population
Source: IMF and A.M. Best
BEST’S COUNTRY RISK REPORT
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Page 2 of 2 August 22, 2018