92% expect revenues to increase, and 59% plan to hire more staff
Insurance chief executives are more optimistic about the global economy and their prospects for growth than a year ago, according to research from PwC.
It found that 92% of global insurance chief executives are confident that their revenues will increase over the next three years.
PwC’s 17th annual CEO Survey, which includes responses from 74 insurance chief executives in 34 countries, also found that the number of chief executives who believe that the global economy will improve over the next 12 months has tripled since last year – 45% now compared with 15% last year.
This positive outlook is mirrored by the fact that 59% of insurance chief executives plan to take on more staff over the coming year.
PwC global insurance leader David Law said chief executives were shifting from “survival mode” to “growth mode” as the immediate economic pressures appear to ease.
“Insurers face the challenge of how to capitalise on the growth potential created by a wealthier and longer living global population, while grappling with the accelerating and potentially disruptive impacts of new technology, regulation and fast changing customer expectations,” Law said.
Areas for concern
Other less positive findings from the survey include:
- 80% of insurance chief executives believe too much regulation is a barrier to growth;
- 86% of insurance chief executives believe technological advances will transform their businesses over the next five years, but more than 60% see the speed of technological change as a threat to their growth prospects; and
- less than 40% of insurers have taken concrete steps to upgrade talent, technology, distribution, data analytics and innovation capacity.
“Our findings raise questions about whether insurers are doing enough to keep pace with the shake-up in the marketplace,” Law said.
“Developments that would have taken years to affect the market in the past can now do so in a matter of months. Insurers that are slow to respond could quickly lose business to more agile and innovative and, potentially, new competitors.
“The successful insurers will be first movers; even fast followers could end up being marginalised. The leaders will have clear insights into how the marketplace is evolving, where they’re best able to compete, and be able to respond quickly to challenges and opportunities.
“They also will use the latest developments in technology to improve customer profiling, reduce costs, and improve the customer experience.”