Episode 23 – Panel Compilation, “What Is the Biggest Opportunity for the Insurance Industry Over the Next 3-5 Years?”

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Beyond the Challenge is a podcast where executives in the insurance and financial services industry share their insights and experiences. Hosts Kevin and Sandy Dougherty talk with today’s top business leaders about what keeps them up at night and the biggest opportunity organizations can capitalize on today. We encourage you to listen, share, and subscribe to our program.

Kevin and Sandy Dougherty each have over 20 years of experience in insurance and financial services, corporate leadership, and executive search. They’re the owners of Global Corporate Solutions and Global Corporate Leaders. Global Corporate Solutions partners with organizations to gain efficiencies and contain costs. Global Corporate Leaders partners with organizations to enhance and evaluate talent.

Beyond the Challenge podcast is sponsored by Exactuals, perfecting payments and the data driving them.

Welcome to Beyond the Challenge. Here are your hosts, Kevin and Sandy.

Sandy: Welcome to Beyond the Challenge. We have spent the last year talking to some of the most influential and forward-thinking leaders in the insurance marketplace.  Their perspectives have been very well received by our audience and we thought it was time to put together some of our favorite guests to see what they thought was the biggest opportunity for the insurance and financial services marketplace for the next few years.

Sandy: In this episode you will hear from Mike Hamilton, SVP, Chief Distribution and Marketing with RBC insurance. Bill Wheeler, President, Athene Holdings. Tim Ash, CEO of Ash Brokerage. Richard DeSousa, SVP, Strategic Partnerships at SCOR and Tom McInerney, CEO at Genworth.

Kevin: During our interviews, we asked each one of our guests what they thought was the biggest opportunity for the Insurance and Financial services industry over the next 3-5 years. Let’s start with what Mike Hamilton had to say.

Mike: When I look at it, the greatest growth opportunity, not only are we developing new products to address new demographics and how we’re engaging our clients on a day-to-day basis, but what I view as the market is more of a generalist format. We built a community within the insurance industry that, “I am a great life insurer,” “I am a great investment insurer,” “I’m a great PNC-er.” I think as we move forward, a generalist format means, “I want all my needs taken care of and I don’t wanna talk to five companies or I don’t wanna talk to five specialists. I want an individual to bring all those resources to bear and take care of my needs because you know who I am, you have my data, and take care of that.” When I think of some of the competitors, you think of an Amazon. Amazon knows the next book you should read just based on what you previously have done. Facebook, based on your interests of the sites you’re going to, knows what other interests you may have. We as an industry need to start thinking like that. We’re far from perfect but I think that’s the next growth opportunity.

Sandy: So, Mike thinks carriers need to be more generalist to build profits over the next few years.

Kevin: He also thinks carriers need to develop new products and do a better job engaging with their customers the way they want to be engaged. Let’s see what Bill Wheeler thinks.

Bill: You know, Kevin, I think it’s gotta be continuing to pursue the retirement market and figuring out how you’re going to participate as a company in that. It’s where the growth is, you know? It’s where the margins are and so if you’re not in the retirement market someway, somehow, I think things are gonna be difficult. You know, I think a lot of people think, “Oh, it’s gotta be technology driven,” and, look, there isn’t much evidence yet that consumers are willing to buy a lot of life insurance. I’m really talking more about the life insurance industry now online. You know, people keep dabbling in it and I think there is some growth but it’s still not very significant. So, certainly, for the next three to five years, what I would call the near term, it’s all about repositioning your company and then also, you know, to deal with the current tough environment and also how do you play the retirement growth story?

Sandy: Bill thinks the best opportunity is in the retirement market and repositioning your company to deal with the current tough environment

Kevin: Next up is Tim Ash.

Tim: I would have a hard time placing it on a single best opportunity. I would say there are multiple things. One is education. We have a large protection gap that’s been talked about in the industry for a long time but without educating the consumer and creating awareness around owning life insurance or doing financial planning or retirement income planning. There needs to be more of that. The second thing is the industry has made it too complicated to acquire, own, purchase, and service insurance products and it has to be simplified. It also has to be integrated. It has to be integrated into that individual’s life and/or that advisor’s ecosystem. And that’s where I think — those are the top two things I would indicate. And the third is we are going to go into the next 10 years with very, very big headwinds, I believe. I believe we’re gonna see income tax rates go up, capital gains rates go up, estate tax rates returning and going up. I don’t believe we’re going to see, as we have experienced the last 10 or 12 years, an increase in the DOW or the S&P fivefold, and I think the industry manufactures products that can help Americans, that can help people with a lot of these concerns. So, the industry needs and can capitalize on that. The tax advantages we enjoy in life insurance as an example is just one. So that’s how I would answer that.

Sandy: Now, Tim has a little different perspective on opportunities coming from the side of the BGA and agents.  Kevin, what do you think about what Tim had to say regarding the need for educating the consumer on the protection gag and taxes?

Kevin: I think he’s right on the money.  We have heard from many guests that insurers need to do a better job preparing their clients for their future needs.

Sandy: Next is one of our most listened to guests, Richard DeSousa.

Richard: Definitely, I’m a huge fan, as I know both of you are, of distribution and, you know, kind of the evolving distribution landscape. I really feel the rethinking distribution period is the biggest opportunity. I mean, the protection gap is getting bigger, there’s a lot more digital solutions, there are less agents entering the workforce so how do you look at all of those then that you rethink how you access distribution and use these digital platforms to reengage, I would say, a salesforce that today might not be very interested? And I think by giving them much better tools, by making it much easier, by removing some of that, you know, most knocking door to door to have to sell, I’m hoping that we can revive what that means. Because if we don’t, that means that a lot more families are not going to get adequate coverage and we just went and we’re hopefully on the tail end and emerging out of a pandemic where we saw hundreds of thousands of lives and many of them did not have adequate coverage and weren’t well protected.

Sandy: Now Richard thinks the biggest opportunity is in the evolving distribution landscape.  

Kevin: I have to agree with Richard. With fewer agents entering the workforce, carriers need to rethink how to use digital platforms and strategic partnerships to get their products to the people who really need them.

Sandy: Let’s see what our final guest, Tom McInerney at Genworth thought.

Tom: To me, I think it’s how we deal with the retiring baby boomers and how we help them with the risks that they face from aging, health-related, long-term care-related, but also how they maximize whatever they’ve saved and, of course, many baby boomers haven’t nearly saved enough but how to maximize that and to provide, because we’re all living longer and that will continue, how do we make whatever their resources are last as long as possible and I think, particularly the insurance industry, because we’re willing to take long-term risks, products with long durations, willing to provide more guarantees than most other industries, including banking, I think using our very strong balance sheets and our risk management capabilities, I think we can really help people protect themselves and particularly specifically to your question, for the 76, 78 million baby boomers, because of all the wealth they control, helping them manage through that aging transition, I think, to me, is the single biggest opportunity for the industry.

Kevin: Tom is another guest that believes that retirement services and wealth management, especially for the baby boomers is where carriers should be looking.  

Sandy: One of the repeating themes I heard from many of our guests was that insurers need to do a better job with the coverage gap.  Kevin, what did you find the most interesting from our responses?

Kevin: I heard a common theme about the need for wealth management and retirement services.  All of our interviewees had great insight into where they see the best opportunities and it sounds like we will see a disruptive next few years in the insurance and financial services industry.

Sandy: I love going back and listening to our past interviews.  I always find something new that I missed the first time and today was no different.

Kevin: I agree, I always pick up at least one more tip that I missed the first time.

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