Insurance Industry Prioritizes Profitability and Technology Adoption, Finds Study
A recent study conducted by Earnix, a global provider of intelligent solutions for insurers and banks, reveals that carriers in the insurance industry are placing a strong emphasis on profitability and technology adoption. The survey of 400 insurance executives highlights key findings that shed light on how carriers can compete and succeed in an evolving industry.
Profitability Takes Priority
The study found that 48 percent of participants prioritize profitability, while only 13 percent prioritize growth metrics. This focus on profit margins is reflected in the attention given to macroeconomic factors, with 28 percent of C-suite executives highlighting it as a top concern. Economic impacts such as inflation, interest rates, and supply chain disruptions continue to be significant considerations.
Adoption of New Technology
To thrive in the industry, carriers must embrace new technology. The study reveals that changing industry regulations are driving 38 percent of participants to consider adopting tools like AI, machine learning, personalization, dynamic pricing, and predictive analytics. Nearly all respondents (98 percent) plan to use predictive modeling to support their personalization strategies.
According to Aaron Wright, Director of Strategy at Earnix, leveraging advanced data analytics capabilities and technologies is crucial for insurers to implement predictive modeling and dynamic pricing. These tools enable carriers to navigate the current period of upheaval and position themselves for success.
The survey, conducted in June 2023, included 400 insurance executives from the United States, Canada, Europe, and Australia. Respondents represented various roles within carriers, spanning C-level, IT, analytics, product, and underwriting. The full report can be downloaded for further insights.
Earnix, with its mission-critical, cloud-based intelligent solutions, has been at the forefront of innovation for insurers and banks since 2001. With customers across six continents, the company helps transform the operations of global insurers and banks, unlocking value across all aspects of their business.
In summary, the study emphasizes the importance of profitability and technology adoption in the insurance industry. Carriers must prioritize profit margins, navigate macroeconomic factors, and embrace advanced technologies to remain competitive and thrive in an evolving landscape.
Impact of Profitability and Technology Prioritization on New Businesses in the Insurance Industry
The study conducted by Earnix reveals a significant shift in the insurance industry, with carriers prioritizing profitability and technology adoption. This shift could have profound implications for new businesses entering the industry.
Emphasis on Profitability
The study's finding that 48 percent of participants prioritize profitability over growth metrics suggests that new businesses need to focus on profit margins to succeed in this industry. This focus is further emphasized by the attention given to macroeconomic factors, such as inflation, interest rates, and supply chain disruptions. New businesses must be prepared to navigate these factors to maintain profitability.
Adoption of Advanced Technologies
The study also highlights the importance of adopting advanced technologies like AI, machine learning, personalization, dynamic pricing, and predictive analytics. This is driven by changing industry regulations, with 38 percent of participants considering adopting these tools. For new businesses, this means investing in these technologies is crucial to staying competitive and thriving in the industry.
In conclusion, the study underscores the need for new businesses in the insurance industry to prioritize profitability and technology adoption. By focusing on these areas, new businesses can better position themselves for success in an evolving industry landscape.