This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

Life Insurance 2020: Rapidly-changing Industry Has Four Ways To Survive, According To PwC Report

NEW YORK, Nov. 27, 2012 /PRNewswire/ -- The life and pensions sector is facing a rapidly-evolving and competitive environment. According to PwC US's "Life Insurance 2020: Competing for a Future" report, companies operating in this sector will need to cope with major social, technological, environmental, economic and political factors and take advantage of emerging opportunities to survive over the next 10 years.

(Logo: http://photos.prnewswire.com/prnh/20100917/NY66894LOGO )

These factors powering change in the sector have the potential to drastically impact the role of life and pension insurers. Some of these market trends include: an aging population increasing demand for retirement income and pension solutions; advances in "big data" and analytics allowing insurers to design products that minimize complexity and meet consumers' need at different life stages; continued risk of government welfare cutbacks, which could shift retirement and benefit decisions back on consumers; shifting economies across the globe in developed and emerging countries; and increasing medical advances (e.g., wearable health monitoring devices, personal genomics) coupled with rising medical costs are increasing risks for consumers and highlighting the need for "well-being" and other pro-active health management programs.

"To survive in the long term, life and pensions companies will need to actively identify and handle threats as they emerge, rather than passively responding to market changes," said Jamie Yoder, PwC's US insurance advisory practice co-leader. "Insurers will need to focus on simplifying the presentation of products and features to customers and advisors, while overcoming a complex set of processes at the back end".

The "Life Insurance 2020: Competing for a Future" report identifies four key themes and related risks that insurers need to address in order to grow. They are:

Two-speed global growth: The overall market for life insurance is increasing in emerging markets and decreasing in the developed world, particularly in the U.S. and Europe. In the U.S., life insurance assets as a percentage of overall household financial assets have been steadily decreasing over the past two decades.  Leading up to the 2008 financial crisis, life insurance was viewed more as an investment, as opposed to a protection product, though guarantees and protection have been viewed more favourably since that time. In addition, the demographic changes occurring in the U.S., such as aging Baby Boomers, are creating a growing market for retirement planning and retirement income.

"Growth for insurers in the life and retirement market will come from expanding into new customer segments, such as middle markets, and alternative distribution channels, such as worksite and direct, by offering more comprehensive advice and developing innovative solutions. However, insurers have to compete with other financial service providers to capture this market and therefore must create capabilities to reach a broader part of the market," added Yoder. "With these new markets, insurers will need to spend more time educating consumers on the value of life insurance and pensions.

1 of 3

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 16,805.41 +127.51 0.76%
S&P 500 1,964.58 +13.76 0.71%
NASDAQ 4,483.7150 +30.9230 0.69%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs