As margins are squeezed in the face of increasing competition and the cushion of investment returns begins to shrink, insurance companies are looking to sharpen underwriting, cut overheads and reduce claims leakage. They are also striving to improve risk management in the wake of recent financial setbacks, solvency pressures and governance scandals.
The payoff from these efforts can already be seen in strengthening market confidence and a resumption of acquisition activity following a relative lull earlier in the decade. Outsourcing and strategic partnerships are also proving increasingly popular.
Commercial challenges faced by insurers include the need to strengthen customer relationships and develop tailored and targeted products and services in the face of more exacting customer demands and increased competition. Regulatory challenges include overcoming the continuing uncertainty with respect to insurance reporting under IFRS and gearing up for the forthcoming Solvency II.
PwC has a global network of specialists who can help insurers turn these challenges into opportunities in key areas of their business including governance, risk and compliance, process improvement, financial reporting and business development strategies.