Insurers looking to gain ground in the retirement income market must first address internal issues around operations and products, according to a report from New York-based Deloitte LLP.
Titled “Mining the Retirement Income Market,” the paper offers key actions insurers should consider as part of a plan to potentially succeed in the retirement market.
"Retirees are more concerned than ever about their ability to generate income that will last throughout their retirement, giving insurers an opportunity to develop new products designed to mitigate uncertainty about retirement income,” says Rebecca Amoroso, head of Deloitte's U.S. Insurance practice. “Insurers face a critical decision about whether to unbundle insurance coverage from asset management offerings and how best to achieve this because their ability to assume these risks is a core strategic advantage over players in the other sectors."
Specifically, the paper advises companies to augment their knowledge of the end customer using analytics. “Insight into consumers' concerns, preferences and behaviors is necessary to determine what is lacking in the current market and to develop creative solutions that fill the gaps," the report says. "Start by analyzing information from existing customer interactions and transactions and supplement with primary consumer research and external consumer databases.”
Deloitte also advises insurers to work on branding and market segmentation and to strategically align the IT infrastructure. “Resist the pressure to respond to changes in business needs with systems and solutions that are deployed with tactical objectives as this commonly leads to duplication of infrastructure across business units and departments,” the report states. “Focus on a long-term portfolio of initiatives that balances short-term benefits with sustainable long-term restructuring.”
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