1. Doing More with Less: Premium growth will be modest at best. Claims inflation will pick up as the economy improves and a lagging bond market will drag down investment income. In other words, insurance companies will have to operate more efficiently with less room for error.
2. Better Data brings Better Results: Predictive analytics and other data centric tools will play a bigger role in separating the winners from the losers. It’s no longer a game of market share. It’s now a game of who can best leverage their data to write profitable risks.
3. What’s my Micro Niche? Niche markets continue to provide superior returns but as competition increases, companies that can identify micro niches within larger markets will accelerate their growth.
4. Social Networking Comes of Age: The impact of Social Networking on brand, customer service, and client acquisition can no longer be ignored. The Internet has changed consumer behavior and companies that fail to incorporate social networks into their day-to-day operations will be at a competitive disadvantage.
5. It’s all about Distribution: The Independent Agent Channel continues its comeback in 2011 as technology, transparency, and access to information makes open architecture a powerful value proposition. Direct to consumer continues to grow for commodity products like auto, home, and term life but creates added pricing pressure. Targeted program business continues to expand.
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