When C-suite executives in the life insurance industry were asked about the most important challenge on their minds, profitable growth was on top in 2023, followed closely by talent management. When the same study was conducted in 2019, change management was what kept executives up at night. By 2021, as companies were forced to meet customers’ changing needs due to the pandemic, executives’ focus shifted to technology.
A third of executives (33%) said their company’s greatest internal challenge was profitable growth, which has been in the top three for the past three studies. Executives surveyed said digital automation, data science and data analytics were the top technologies needed to ensure their companies’ success over the next five years.
The report, “What’s on the Minds of Life Insurance Executives 2023,” released in October 2023, highlights five ways to address growth and other key challenges. Here are five opportunities to promote growth in the industry.
1. Personalizing the journey: The customer experience — and the critical capabilities that enable it — will help drive growth. Almost three-quarters of those surveyed (74%) said data science and data analytics are crucial to success. More than 6 in 10 (66%) view customer service technologies as critical to business success going forward.
2. Helping advisors help clients: To be effective, insurers must focus on improving tools and offering insights to help advisors build and maintain customer relationships. The survey revealed that 60% of executives see helping advisors as a top distribution challenge. Insurers can help advisors by providing tools for lead generation, financial planning and automation to make it easier to reach clients and prospects.
3. Modernizing technology front to back: Technology modernization is table stakes for long-term success; however, leaders do not believe their companies are prepared to address it. Although insurers are investing in technology across the value chain — including data science and analytics — only 27% of executives consider their companies prepared for the challenge of modernization.
4. Partnering to accelerate innovation: Insurers are actively partnering with other companies to achieve their key strategic goals. Some recent examples include Ameritas and Ethos working together to enable simplified digital product sales, John Hancock and Vitality collaborating to offer rewards for healthy choices and tools that customers can use to improve their overall well-being, and Pacific Life Insurance and Appian joining forces to intelligently source data to resolve claims quickly and minimize cost.
5. Attracting and retaining talent: Talent management is a leading challenge, and rapid industry changes require insurers to plan and act now to build the workforce of the future. To meet customers’ changing needs, insurers will want to hire and retain more employees with digital skills. They can take action by:
• Reassessing the hiring process and job requirements.
• Developing programs to reskill and upskill talent.
• Building ecosystems of shared, temporary talent.
• Building a strategy and infrastructure for remote work.
New annualized life insurance premium has had modest growth year over year, setting a record for each of the past three years. There has also been a strong uptick in the number of policies sold. LIMRA’s consumer sentiment data suggests that more people started feeling more confident in the economy and their own financial outlook in 2024. This may have prompted consumers to address their life insurance needs. As more people seek the financial protection life insurance can provide, insurers must be ready with technology and solutions to meet the growing demand.