Summary
The article is interesting because is evaluating the engines behind the globalization trend in life insurance insdustry. In particular, the article examines two important demographic trends: (1) the ageing of the world's population and (2) the increase in life expectancy of these populations. It is interesting to explore additional trends - customers becoming more demanding, the technology playing an even bigger role, and the challenge in attracting and retaining talent - and their potential impact on the future of life insurance industry.
Analysis
The only confident prediction about the future is that it will be different from the world we live in today! The changes in technology, science, politics, economy, society and environment will play an important role in redefining the life insurance industry as we know it. I outlined below few important trends that - in my opinion - will impact the insurance industry during the next decade.
- Globalization
- Will play an important role in reshaping the industry; the economic power shifting to China, India and other emerging markets will impact the consolidation and restructure the industry
- Consumers will be more demanding
- The information flow will determine the companies to truly become customer centric
- Technology will play a more important role in acquiring, selling and servicing the customer
- Companies will be able to cut their costs by integrating better technology into the day to day operations – from underwriting to policy services
- The life insurance industry will have a more difficult time to attract and retain talent
- The number of agents / financial advisers is going down already – it became an expensive proposition for the companies in the life insurance space to train new sales people as well as difficult for the agents to become successful in this field due to the added distribution channels
One way that will allow you to better position for the future of this industry is through scenario planning. However, if you want to have a successful scenario-planning process, you have to separate trends form uncertainties – forces that are likely to impact the life insurance industry – and limit the range of possibilities by depicting only few scenarios in detail.
