The last five years have presented unrelenting change for insurers, including the need to keep pace with both changing regulations and changing digital and technology capabilities. Customers want engaging, personalized experiences while governments need to reduce volatility. Yet in the midst of this struggle, insurers have maintained a steady focus on growth.
True, they’ve had to cut costs. According to our High Performance Finance Study, Insurance Report, the past two years have seen many cost cutting measures. Among insurance companies, 82 percent made functional cost reductions, 79 conducted operating model rationalizations and 68 percent rationalized their business portfolios in the last two years.
But these numbers don’t tell the whole story for insurance companies. In fact, a solid majority of them are looking forward, steadily eyeing growth even in volatile times. Our research shows about three in four insurers are investing primarily in growth-focused activities.
Chief financial officers and other finance executives at insurance companies are at the forefront of juggling this dual focus on cost cutting and growth. They need to streamline and seek efficiencies with their mature lines, while remaining open to growth opportunities anywhere in the mix. Our study suggests these executives are rising to the challenge.
Roadblocks remain for insurers, and we’ll look at these in my next post. We’ll then move on to talk about infrastructure models and new technologies. There’s more to come as we discuss ways to help insurers keep growth on the front burner.