Recession typically spells bad news for most, with companies and firms facing lower sales volumes, needing to lay off workers, causing higher unemployment amongst the working population, which causes overall consumption and demand to fall as well, causing the whole economy to decline significantly in outputs.
Recession & inflation
So, is Singapore expected to go into a recession? Although the economic climate has been undergoing much volatility, uncertainty and risks, Minister of State for Trade and Industry Alvin Tan maintains that Singapore is unlikely to face a major recession for now.
This probably holds true for this year as well as in 2023, but it does not mean that there is no risk of further deterioration and risks to our economy in the next few years.
Although Singapore’s economy has not declined yet, overall growth is headed towards sluggishness and slowing downwith a volatile and uncertain outlook for the year ahead.
On the contrary, one of the major risks that we are currently facing would be the high and persistent inflation putting continuous upward pressure on the prices of our food, utilities, transport and more. With Singapore’s core inflation rising to 4.4 per cent in June 2022, the highest since November 2008, it is becoming an increasing pressing problem for many Singaporeans.
Buying insurance during recession
When the economy is facing a recession, would you still continue to buy insurance?
For many types of insurance, including life, health, home and car insurance policies, many insurers may see a downturn in their customers and premiums. This is probably due to customers needing to save their money for other necessities and expenses, therefore choosing to shrink their coverage on their insurance policies.
Premiums may also increase if the recession is prolonged, because insurers would begin to see underwriting losses due