Choosing the right business model for retirement services

Once life insurers have a handle on consumers’ circumstances, needs and preferences, the next step is choosing which markets to target—and how. We believe there are at least four possible business models:

  1. Fully integrated insurer: An organization with a strong brand and balance sheet, and the appetite to invest in competitive capabilities across the enterprise and across all markets
  2. Market segment insurer: An organization that wants to be involved in product development and distribution, but chooses to target specific customer or geographic markets.
  3. Product expert: An organization that specializes in developing complex products efficiently and uses other organizations to distribute them.
  4. Distribution specialist: An organization with effective segmentation, marketing and sales capabilities, which it uses to distribute other companies’ products.

What type of insurer do you want to be?

The temptation for many will be to “do it all”—provide savings and investment services alongside insurance products, such as annuities, to all types of customers in all markets. The reality is that most insurance organizations are not equipped to be credible competitors across the spectrum of services and market segments. For many, specialization will be essential.

Whichever path you choose will have profound implications for your organization’s approach to operations, distribution and marketing. What’s more, the clock is ticking. Just as consumers cannot afford to delay retirement preparations, insurers that spend too much time considering their options risk ending up with none.

Visit this blog every week for interesting insights from the Accenture Global Retirement Services Survey. Read other posts in our “closing the advice gap” series:

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