The future of the property-casualty industry is bright, and that of the life and health insurance industry even brighter, according to two polls of prominent insurance executives conducted by Ward Group.
2014 marks the third year survey respondents have expressed increased confidence in their ability to increase revenue and generate profit at their firm. Specifically, 86% of property/casualty participants and 94% of life and health participants said the industry is about the same or better than it was a year ago.
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Aon Hewitt company asked executives how their companies were adapting to current economic conditions, as well as their own challenges and concerns. The surveys also featured insights into the technological revolution gripping the industry.
A positive outlook
Despite challenges in both the property/casualty and life and health spaces, insurance executives remain positive both about their own performances and the performance of the industry in general.
Only 14% of P&C executives and 6% of life and health executives said the current state of the industry is worse than in 2013.
Technology continues to grow
The most significant changes in spending were concentrated in technology, with 82% of P/C and 79% of life executives planning to increase spending on technology to keep up with demand.
As compared to last year, 28% of P&C respondents said their tech spending is “significantly more” (defined as 15% or more) than it was in 2013. Another 28% of life and health respondents said the same.
“It is clear that companies are making significant investments in technology and hiring staff to meet new business opportunities,” said Jeff Rieder, partner and head of Ward Group. “It will be important for companies to continually measure the success of these initiatives and have employee compensation programs that are aligned with goals to drive results.”
Keeping up with technological demand was also a concern expressed by many survey respondents.
Concerns for the future
Despite their optimistic outlook, executives do have a few worries about the future. According to the poll, the most prominent concerns include:
1. Keeping up with technology needs and managing the associated costs
2. Maintaining profitable growth
3. Handling exposures related to catastrophes and increasing medical costs
4. Uncertainty regarding the regulatory and legal environment
5. Low interest rates negatively impacting investment returns
6. The impacts of healthcare reform
7. Recruiting and retaining talent
A full copy of the results for both surveys can be found online at the Ward Group website.
