Standing out in the crowded financial services pack is possible if insurers can distinguish themselves in two key areas: product and distribution.
Detailed discussions of how those two critical components are developing were covered during the 12th PricewaterhouseCoopers conference.
Panelists concurred that insurers should offer simpler products to consumers.
“We need products that are simpler. Insurance companies should come back to their strengths–protections and payouts,” says Scott Sleyster, president, retirement services and guaranteed products, with Prudential Financial, Newark, N.J. “To some extent, we have overcomplicated products. Mutual funds are understandable.”
Complex product features may be a cause of concern in the future, executives said.
“We are seeing guarantees in the variable area and frankly, Im a little worried. Im not sure that the market is pricing those guarantees properly,” said Sy Sternberg, chairman, president and CEO, with New York Life Insurance Company, New York.
“If it looks like its too good a deal, then a company might not be pricing it the right way,” said Edward Zore, president and CEO with Northwestern Mutual Life Insurance Company, Milwaukee.
One product that looks good to Zore is the immediate annuity. “The immediate annuity will be a very large market in the future. It is the next sweet spot.”
Simplicity was a theme that speakers also weaved into discussions about distribution.