As the insurance industry moves forward to improve its business performance it must also manage the challenges of a recession. Special challenges for the property/casualty insurance industry in the upcoming year include the inability to meet revenue forecasts, declining operating margins, increase in debt and a decline in market share for certain client segments, according to speakers at a Women’s Network Group session in Sacramento, Calif.
The WNG recently held a session to discuss the challenges and opportunities in a softening marketplace and economy. Among the participants in the meeting were women from various industry sectors, including insurance and financial services.
According to the speakers, the recession could have a few upsides for the insurance industry. “An economic downturn can create great opportunities for new product and service innovation. In addition, it also creates the opportunity to break bad, and outdated, habits. Both innovation and creativity can be the best ingredients to produce great results in 2008,” said Julie K. Davis, executive vice president, Aon Corp. “While sagging expectations for the U.S. economy may lead some client industries to lower their revenue forecasts, new product and service expansions into new markets can’t be overlooked,” she said.
Davis led a group discussion at the Women’s Network Meeting in March and they reviewed common issues that the insurance industry faces in 2008. They include changing distribution channels, new product and service innovation, mergers and acquisitions, talent management, technology integration, regulatory and transparency issues and a continuing soft market. The group also discussed challenges around cost of capital and internal hurdle rates for new ideas. “These are the issues that will matter the most in 2008,” Davis said.
The WNG event has approximately 120 participants. The group is a women’s association designed for leaders of new or rapidly growing companies with less than 1,000 employees and leaders of autonomous business units in larger organizations.
Source: Women’s Network Group