Technology innovation will provide the biggest growth opportunities for reinsurers in the year ahead, according to a survey by Guy Carpenter & Co. The survey polled executives from insurance and reinsurance companies, asking them to identify the top opportunities and threats, and the most significant disruptive forces.
Forty-two percent of those surveyed believe technology innovation represents the greatest growth opportunity in 2017, followed by new products (25 percent), new geographic markets (13 percent), talent acquisition (12 percent), and mergers and acquisitions (M&A) (8 percent).
Thirty-six percent of respondents cited the potential for a financial recession as the emerging risk that will be the biggest threat to profitable growth in the year ahead.
Meanwhile, 1-in-3 professionals ranked cyber as the most threatening emerging risk, followed by technology risks (11 percent), climate change (11 percent) and terrorism (9 percent).
“One of the most important findings we can take away from this year’s survey is the significant growth opportunity that technology innovation continues to bring to the (re)insurance industry,” said Tim Gardner, CEO of U.S. operations for Guy Carpenter. “The industry must be prepared to not only understand and manage the risks associated with these rapid advancements, but to also utilize these innovations to create actionable business intelligence and realize profitable growth opportunities.”
Thirty-eight percent of those surveyed viewed predicted the continued rise of big data will cause the most disruption in the (re)insurance industry over the next five years. Other market-changing forces include the speed of technological innovation (29 percent), aging population (15 percent), millennials (13 percent) and expanding urbanization (5 percent).
Looking to 2017, 21 percent see regulatory and rating agency changes as the biggest threat to profitable growth. Seventeen percent are concerned about global economic and political uncertainty; 16 percent fear operational inefficiencies; and 10 percent are most concerned about catastrophe/non-catastrophe losses.
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