A significant majority of insurance-carrier CEOs are upbeat about the prospects of revenue growth over the next few years, mirroring the views of financial-services executives in general, according to a recent survey.
Of the 92 insurance CEOs (a mix of P&C and life insurers) in 39 countries surveyed for PricewaterhouseCoopers' 16th annual global CEO survey, 90 percent are reasonably confident revenue will grow over the next 12 months, and next three years.
Carrier executives are not as positive about the overall economic picture, though. Just 15 percent believe the economy will improve in the next 12 months, according to the survey, and close to a quarter expect the economy to decline. PwCsays last year's survey showed even more skepticism, with close to half believing the economy would get worse.
Carriers are pessimistic about growth in developed countries because of economic pressures and limited expansion of product in mature markets, PwC says.
But the execs were more upbeat about South America, Asia, Africa and the Middle East, where there is a rising middle class needing the protection insurance offers to property and wealth. The CEOs are focused mainly on Asia, with 80 percent targeting expansion throughout that region, except for Central Asia where the number drops to 63 percent.
Some of the enthusiasm the insurers had for the Middle East and Africa has fallen significantly over the last year, the report points out.
PwC says insurance CEOs see technology taking a central role in “sharpening risk-understanding and customer-profiling.”
Insurers “are leading the way” in the funding of technology among industries, with 86 percent of the CEOs indicating they plan to increase investment, says PwC.
However, the “speed of technological change” is seen as a barrier to growth by just 43 percent of the executives.
PwC explains, “Underlying all of this is an apparent preference for incremental change over radical innovation,” says PwC.
“There is a danger that insurers could be caught flat footed if they don't quicken the pace of innovation and development,” says the report.
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