The report outlines six options that have the potential to provide long-term boosts in revenue:

• Launching new products.
• Revamp existing policies.
• Consider strategic M&A.
• Expand into emerging markets.
• Add/enhance distribution outlets.
• Raise rates/increase penetration.

Regarding emerging markets, Deloitte notes that Brazil has seen strong economic growth fueled in part by a “young population that is increasingly in need of financial products and services.”

The Asia-Pacific region, Deloitte adds, is “already an attractive target for carriers, accounting for 23 percent of global M&A insurance activity in the first half of 2011, up from 12 percent in fiscal year 2010 and fiscal year 2009.

On the issue of M&A, Deloitte says the time “appears to be ripe for more consolidation” in the industry due to excess capital, bargain pricing and low returns.

The report notes that 2011 did see elevated M&A activity, but notes the deals were more strategic. The year did not see more M&A activity despite the macro-economic conditions, says Deloitte, possibly because “potential buyers that are publicly-held may be under pressure from investors to pay dividends and offer stock buybacks rather than devote capital to potentially risky takeovers.” Deloitte adds that buyers may have also been questioning sellers' reserve strength.

Deloitte says insurers should also consider adding new distribution options to drive growth in 2012. “For some,” the report says, “that means adding new channels, such as online sales capability either on a standalone basis or to complement their existing agency-distribution force. For others, that means changing who they distribute through.”

Regarding relationships with independent agents, Deloitte says carriers “often swing two ways in terms of producer assessment. Traditionally, the pendulum has tilted more towards the emotional side of producer relations, which emphasizes the personal relationships maintained over the years with carriers.”

But Deloitte says with the lack of growth, insurers may begin to swing more to the scientific side and base distribution decisions on analytics and evaluating what kind of business the agent is and will be producing, as well as how the carrier's strengths meet agents' needs.

Deloitte says, “Producers continue to be concerned about disintermediation as more carrier add online capabilities. However, online and agent channels need not be mutually exclusive, and in fact electronic and human information sources could be quite complementary.”