Multinational professional services firm PricewaterhouseCoopers (PwC) has produced a report detailing the evolving forces that will shape the life insurance industry in the near-future and the opportunities that can arise from these changes.
Although conjecture, Life insurance 2020: Competing for a future makes it clear that these trends are not possibilities but rather likely scenarios that those involved in the industry should begin adapting to.
And for an industry that is in many ways dilatory when it comes to change, remaining nimble and able to adjust in an evolving marketplace is crucial.
The report encourages the industry to look “outside in.” Insurers are can be quite insulated; focusing on keeping up with their peers which can leave them vulnerable to being left behind when it comes to developing trends outside of the insurance world. Jamie Yoder, PwC’s U.S. insurance advisory practice co-leader, said, “Good organizations are rethinking who they define as competitors and are trying to draw from a broader set of capabilities.” An important aspect of the “outside in” approach, and the report as a whole, is the cultivation of trust and integrity within the organization that will enable insurers to respond to customers’ needs quicker than their competitors thus propagating their value and strengthening their market share.
Insurers will also have to harness their use of big data to remain relevant. Insurers can use data that they purchase from external sources or develop in-house to examine the behavior of customers in the marketplace. Advanced analytics should be used to design new products for the evolving household. This could present a challenge as some executives at large carriers are apprehensive to put too much credence in data. Yoder, however, feels that there is a willingness to examine the data and incorporate it into product development.