For an industry that has stayed largely the same over the past century or even longer, insurers have of late been navigating through significant waves of change. The old guards of the US property & casualty (P&C) industry are facing severe headwinds on the one hand, while on the other have been fending off intruders at their gates. Underlying socioeconomic, technological and regulatory changes are joining hands with the changing nature of risk itself to recast the role and value of the traditional P&C insurer. The changing nature of tomorrow’s risk, coupled with technological advances and ever-increasing consumer expectations, are also paving the way for new entrants with significant proprietary consumer behavioral data and highly differentiated digital and analytics capabilities.
Given the tremendous opportunity ahead, EY and ACORD studied the 100 largest US P&C insurers and looked at their performance over the past two decades to see which insurers are consistently shaping up the market and setting the pace for the industry to follow. Based on this detailed one-of-a-kind analysis, we have shared key execution imperatives that can be used by insurers to improve their transformation efforts toward achieving sustained growth, risk and expense management.
As the results of our analysis showed up, it became increasingly evident why the top focus areas for the US P&C industry happen to be what they are. While each focus area deals with a specific dimension of the insurance value chain, together they address the three greatest challenges facing the industry today: growth, risk and expense management. Key focus areas identified in the study include:
- Operational excellence and cost efficiency
- Risk selection, management and underwriting excellence
- Alternate distribution channels and digitizing distribution
- Customer experience improvement
- Mastering emerging and disruptive technologies
- Talent acquisition, development and retention