A Thanksgiving Table of Insurers
It’s that time of year again, to gather at the table, look back at the year, and say your thanks. If insurers were to gather at the same table and discuss their thanks for 2015, the conversation would be lengthy. Insurers have much to be thankful for, but at the same time, it would not be easy to keep concerns out of the conversation.
According to an estimate from LIMRA, life insurers should be giving thanks for an increase in demand for insurance, allowing premiums to rise. “This was the fourth consecutive quarter of premium growth for individual life insurance. Every major product line except variable life recorded positive growth,” noted Ashley Durham, Assistant Research Director of LIMRA Insurance Research. “In the first half of 2015, strong whole life and indexed universal life sales resulted in a 7 percent increase for overall individual life insurance premium, the highest mid-year growth since 2010.”
Even though insurance sales are rising, LIMRA’s 2015 Insurance Barometer Study found that nearly one-third (30%) of Americans believe they need more life insurance, but the majority of Americans (54%) say it’s unlikely that they will purchase life insurance within the next 12 months. Insurers may be able to give thanks for the interest in attaining more life insurance, but now they need to turn their attention to that coverage gap and consumer adverse perceptions regarding the purchase of insurance.
At this Thanksgiving table, insurers should be thanking the emerging technologies that are enabling underwriters to spend more time on activities such as decision-making and solution development. For the insurers that are early adopters, technology is allowing faster underwriting cycles and automated underwriting. Insurers are boosting customer satisfaction by delivering policies in reduced time frames, while at the same time affording their underwriters the ability to expand their capabilities.
An aging workforce as well as the shift in underwriting tasks is leading to a need for increased capabilities and enhanced skills for each underwriter. As insurers look for new talent, they will need to mitigate their knowledge loss and operational risk, while trying to find qualified candidates for a changing position.
Finally, the American markets should be breathing a sigh of relief that there were no major catastrophes leading to large numbers of claim payments this year. Every year that we can say this is a good year, for obvious reasons. While insurers look around the Thanksgiving table, counting their blessings, there also needs to be thoughts of 2016 and all the challenges and opportunities that wait for them.