Top 3 Challenges in the Insurance Industry
What do your peers think about Insurance Industry?
The insurance industry professionals we surveyed mentioned that they are mainly challenged in managing regulatory and legislative changes and staying up to date with technology innovation. Moreover, companies suffer from a real lack of insurance experts.
Insurance Top 3 peer challenges
Regulations and Legislation
The biggest challenges faced by the sector’s main actors are stricter regulations and tighter legal issues when it comes to insuring people or companies, as well as ongoing reforms requiring regular process changes.
Bringing out new technologies to provide customers the best quality services and the best communication possible. There is an increasing need for new technologies in the industry, and companies find it difficult to keep up with it (which is quite often the case in conservative industries). Fortunately, start-up companies have started to disrupt the industry quite a lot by improving the relationship customers have with their insurer and/or by offering cheaper services.
Because of talent shortage, companies tend to recruit people with inadequate skills which complicates processes and decrease productivity.
- Poor economic conditions
- High number of claims
- Poor risk management
Research-based trends and short-term forecast
Research shows that emerging technologies and cultural shifts produce significant challenges to the insurance industry. New technologies and services, such as pay-per-usage, are creating opportunities and also challenges for insurance companies. By 2020, the global usage based insurance market penetration will be 15% compared to now, <1% (Deloitte, EY).
In 2018 IT spending (on information management software) of the global insurance industry will be 2,406 million US$. In 2017 North America will still hold the majority of the global health insurance market by 788 billion US$ (gross written premiums), EMEA 240 billion, and APAC 116 billion (EY).
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