Insurance companies are struggling to increase business revenue from the sales of their core insurance products. For instance, the premium sales growth in the US market is down to single digits.
The insurance industry is at the tipping point with regards to data and analytics. The traditional method of building data warehouses/data marts over 2-3 years and creating a reporting function above these warehouses is being replaced by new approaches that quickly deliver data and actionable insights to business.
The increased adoption of digital and online technologies is disrupting how insurance is marketed, sold and serviced and can have an adverse effect on insurance business growth and cost of operations for companies that persist with traditional processes. Previously, the insurance industry was driven by key capabilities in distribution, financial and information processing. Today, insurers that want to retain their competitive edge must adapt to the need for better customer service and new distribution channels.
Insurance companies face pressure from supervisors to optimize risk governance and risk management. As regulatory requirements such as Solvency II and IFRS4/9 evolve and introduction timelines change, insurers need to organize their resources, governance and IT landscape to comply with national and supranational standards. However, the lack of global harmonization in regulatory affairs poses challenges to global insurance players.