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Short insights on topics of interest to leaders in the global insurance industry.

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Live from DIA Amsterdam 2019: The three megatrends and one global shift driving insurtech innovation

Attendees at this year’s Digital Insurance Agenda (DIA) operate at the heart of the insurance industry—particularly when it comes to insurtech innovation. While the expected massive disruption in the industry remains to be seen at full scale, it’s clear that the insurtech space is maturing and that the impact in the industry is accelerating. Three insurance megatrends—and one all-encompassing global shift—reveal the direction the industry is heading and suggest ...

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Ten years of change in direct insurance

In June, we celebrated our tenth annual Direct Forum in Barcelona. The Forum is an opportunity for direct players across Europe and beyond to discuss the market, trends, and new innovations. This year, it was also a great opportunity to look back at the past ten years of change in the direct market and discuss where the road will lead next. Strong growth, but stronger expectations According to McKinsey analysis, the direct channel has made great strides in the past ten years, growing from a ...

Digital refinement: New opportunities for growth in the bancassurance channel

Global bancassurance sales grew across all regions in the past decade, outpacing other channels in both life and nonlife products. Due in large part to low starting penetration, Asia–Pacific posted the largest contribution to bancassurance growth in absolute terms, while Europe and Latin America experienced among the highest growth rates in sales. Life products are the focus of bancassurance growth in Asia–Pacific and Latin America, as banks are increasingly motivated to increase ...

Prioritizing financial protection in the face of extreme weather

The three consecutive, major hurricanes in 2017, Harvey, Irma and Maria, devastated parts of Texas, Florida, and most of Puerto Rico. Each was among the ten most costly insured natural catastrophes globally, with total economic costs surpassing $270 billion. And while the 2018 hurricane season costs didn’t match that of the previous record year, hurricanes Florence and Michael swept across Florida and the Carolinas and became two of the most destructive storms in recent years, as well. ...

How to maximize the chances of achieving your insurance claims aspiration

Almost a quarter-century ago, research by John Kotter found that only 30 percent of change management programs succeed. And a decade ago, McKinsey research found that the needle hasn’t moved. As of today, it still hasn’t. Transforming insurance claims operations is particularly difficult given its distributed teams, multiple stakeholders, and fast-paced operations. What’s more, the pace of change is accelerating. Claims will likely look completely different by 2030, shaped ...

A catch-up play for unit-linked products in Asia-Pacific insurance

Unit-linked products (ULPs) are a pillar of the global life insurance industry. They combine individual investment strategies with the protection of an insurance policy under one plan, providing customers with an incentive to save in the long term, especially for retirement purposes. Yet in Asia–Pacific, ULPs have underperformed overall in recent years, with varied relevance and performance by market. Since 2014, their overall market share declined from approximately 16 percent of total ...

A new industry model for insurtech

Insurance companies should pay close attention to insurtechs—not because they’re coming to attack, but because they're coming to collaborate. For established insurers, insurtechs can be digital enablers that drive the adoption of digital technologies along the value chain. To realize the potential, it’s important that both sides focus on the strength they’re bringing to the table. Insurtechs are maturing According to McKinsey research, more than $10 billion has been ...

Life insurers: How to win in Asia–Pacific

In a recent blog, we discussed where the real value is in Asia–Pacific life insurance: overall, the region has been growing at a fast clip, but beneath the top-line numbers are countries with vastly different prospects and consumers. To capture value in Asia–Pacific, carriers must gain a granular understanding within markets, segments, channels, and product lines. Only then can executives accurately determine where to play. That’s just the first step, however. Insurers must ...

Life insurers: Where to play for value in Asia–Pacific

McKinsey’s Where the life insurance industry can go from here highlighted many Asia–Pacific countries as engines for global growth. The region is forecast to account for nearly 50 percent of top-line gross written premium growth in the years to come. But to speak of the region as a monolith is to obscure its actual opportunities. Indeed, life insurers that fail to differentiate their approach across and within markets would miss the real-value opportunity. And those that can pinpoint ...

The four emerging themes shaping small commercial insurance

Prior to joining McKinsey, I was fortunate to spend 17 years in the insurance industry as a global broker. I entered the business in 2002, when—as one would rightly imagine—the months in our industry immediately following the September 11th attacks were tumultuous and rife uncertainty. Global insurance capacity was crashing, especially in the large commercial property market, and many of the risk transfer and commercial exchange practices that governed the industry for hundreds of ...

Insurance in Asia and the West – what can each market learn from the other?

After spending the past two decades working with global insurers based in Western markets, I recently moved to Hong Kong to lead McKinsey’s Insurance practice in Asia. Over the past nine months, I’ve met with more than 200 executives in the region to listen and learn. In doing so, I’ve been struck by how the carriers in this part of the globe are leading the world on many dimensions while lagging behind on others. From my perspective, insurance in Asia’s developing ...

Unleashing the CMO in B2B insurance

Unlike their B2C counterparts, many B2B insurers do not consider marketing a vital function, relying instead on intermediaries, such as brokers and agents, to promote their products. Though this model has been effective for some time, carriers run the risk of commoditization when reliant solely on intermediaries, and customers have come to expect personalized offers. To address these issues, among others, B2B insurers need to bring on—or revise the role of—the marketing function in ...