Top insurance industry issues in 2018

The changes we are seeing in the industry and our perspectives on how insurers can make disruption work to their advantage.

Insurance is an industry under stress

According to the PwC's 20th CEO Survey, a higher percentage of insurance CEOs than those in any other industry are extremely concerned about the threats to their growth prospects from over-regulation, the speed of technological change, changing customer behavior, and competition from new market entrants.

In short, the entire insurance business model is being disrupted. At PwC's Financial Services Audit and Risk Committee Forum (FSARCF), one-third of insurance attendees cited technology – including the new market entrants that are often behind technological change – and customers' expectations for 24-hour service as the most disruptive forces on the insurance business.

35% of the insurer directors in attendance said they think "the industry landscape will stay the same, but the players will change substantially in five to 10 years."

44% think that "most existing insurers will not survive, at least in their current form.”

Source: PwC’s Audit and Risk Committee Forum survey

The industry is proactively confronting these and other changes

  • Forty-four percent of FSARCF insurance attendees said new market entrants, such as InsurTech companies, are potential business partners, and insurance companies have been keen adopters of new core systems, AI, and automated processes. 
  • The industry has been a hotbed of deals activity in recent years, which has resulted not just in consolidation but also from a play by outside investors who see promise in the industry.
  • Even developments that, on their face, may not seem like major disruptors of business and operating models are inspiring many insurers to change even faster. For example, IFRS 17, an accounting standard, and a desire to be “fit for purpose” are influencing many companies to examine how they do business and the products they offer.

 

PwC’s Audit and Risk Committee Forum - Insurance session audience survey

Contact us

Eric Trowbridge
Insurance marketing leader, PwC US
Tel: +1 (202) 248 4470
Email

Amy Rose
Insurance marketing manager, PwC US
Tel: +1 (571) 766 9266
Email

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