New York - A number of life insurance executives recently surveyed by Deloitte & Touche USA LLP's insurance industry group related that technology is more likely to be considered a barrier at this point in time, rather than a strength. Many stated they can do better in terms of streamlining the growth processes to enhance the distributor and customer experience, and they do not believe their technology is as advanced as it can and should be.The survey of 20 C-suite executives from top life insurance companies, as well as an analysis of life insurance industry growth patterns contributed to a report--"Organic Growth for Life Insurers: A Playbook for Market Advantage."
As life insurers renew their focus on increasing revenue and market share, the report cautions that the sector must make major breakthroughs to find profitable and sustainable top-line growth. Currently, most spread their efforts on a broad portfolio of initiatives and have not developed high-potential initiatives; instead, they must take a more targeted and systematic approach to formulating their growth strategies.
Although companies are not likely to transform their growth initiatives overnight, or tackle every aspect of their growth processes at once, the report recommends life insurers begins the process by assessing their "growth readiness"--diagnosing their current strengths and weaknesses, identifying gaps in their abilities, and determining where to focus their efforts to achieve results. Such an assessment can prepare them for developing a coordinated organic growth strategy designed to outpace the competition.
"In general, many of the ingredients needed for organic growth, such as a wealth of information and a growing emphasis on solid execution, are already in place at most companies," says Joe Guastella, the national insurance industry leader for Deloitte Consulting, a subsidiary of Deloitte & Touche. "The challenge lies in bringing those ingredients together in a much more focused and thoughtful way to differentiate and move out of the pack."
According to those executives surveyed, top-line organic growth dominates the list of life insurers' top priorities, with their top three growth strategies being product innovation, improved distribution, and service enhancements to improve retention. The challenge in executing these strategies lies in the alarming commonality in approach and priorities, the report noted.
The report's authors point to this similarity in approach as a fundamental roadblock to generating sustainable growth. The authors offer instead that companies should focus on information, innovation and implementation to help shape truly differentiated growth strategies.
"We recommend that companies should explicitly focus on these three areas," says Alice Kroll, a director in Deloitte's insurance industry group and the white paper's second author. "First, they should be thinking about how information about customers, producers, and markets can be used more effectively to identify growth opportunities. Also, how innovation processes can be shaped to yield breakthrough offerings. And, finally, the right approach to implementation, which in and of itself is an area where many life insurance companies fall short. But it is most important that they learn to integrate these three components into an overall, end-to-end growth-driving process."
Source: Deloitte & Touche USA LLP
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