Ernst & Young’s 2014 U.S. Life Insurance-Annuity Outlook recently indicated that life insurers may, amid increased consumer confidence and ongoing economic recovery, see more opportunities to rebuild product portfolios and expand into unpenetrated markets.
“Insurers eyeing growth opportunities need to develop cost-effective ways to distribute products to empowered consumers who are open to purchasing life insurance and annuities through alternative distribution channels,” Doug French, the principal of financial services and insurance and actuarial advisory services at Ernst & Young, said. “By leveraging sophisticated technology, digital and data analysis techniques, and investing in the right people, processes and methodologies, insurers can streamline operations and support robust growth strategies.”
EY said life and annuity insurance firms must take the offense by becoming more customer-focused and technologically advanced, streamlining operations to boost efficiency, investing in enterprise data excellence, improving capital efficiency and anticipating regulatory and accounting changes.
“Insurers eyeing growth opportunities beyond [high-net-worth and mass-affluent market] segments are developing cost effective ways to distribute to mass-market consumers…” the EY report read. “To attract such customers, insurers must segment their mass-market approaches, responding to the demographic, socioeconomic and digital diversity of the customer base.”