ATLANTA-- 2004 may be a better year for the insurance and financial services industry, say members of the LOMA board of directors. LOMA's Resource magazine recently surveyed LOMA's directors, who represent global leaders in financial services, seeking their industry forecast for 2004. Most of the directors participating in the survey agreed that, with the U.S. economy showing signs of gradual recovery, things are looking up for industry sales, premiums, and profits.
"The third quarter of 2003 was very strong, and subsequent developments seem to indicate the economy is recovering," said David M. Holland, FSA, MAAA, president and CEO of Munich American Reassurance Co. and the new chairman of the LOMA board of directors. "The fact that 2004 is an election year also adds impetus for continued economic improvement. Accordingly, I'm moderately optimistic about sales and profits."
Excerpts from the 2004 Industry Forecast, which appears in the January issue of LOMA's Resource magazine include:
* Sales, Premiums and Profits: Low to moderate growth can be expected Look for variable products to make a comeback.
* Mergers & Consolidation: The merger and consolidation trend will almost certainly continue. This activity could eventually lead to an industry consisting mostly of large companies and smaller niche players, with few mid-sized companies.
* Outsourcing: This business practice could help companies reduce costs, but it also means losing some control and contributing to the loss of domestic U.S. jobs.
* Technology: Wireless technology, process automation, and imaging have the greatest potential for helping the industry thrive.
* Boosting Profitability: Companies must maintain greater vigilance over expenses, maintain rational pricing discipline, and work to increase sales.
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