Market-based indicators suggest that global energy prices will stay high in the near term but will then moderate to some extent.9 High levels of inflation over a prolonged period would have more of an adverse impact on non-life (re)insurers (including health insurers) than life (re)insurers due to differences in the way claims are indemnified.
This is because non-life firms typically indemnify the policyholder for incurred losses which are set in real terms, whereas life insurance claims are usually expressed in nominal terms. Higher rates of inflation are already affecting the cost of settling some non-life claims due to rising labour and materials costs (for example, motor vehicle or property damage repairs).