|By Marketwired .||
|August 20, 2014 11:00 AM EDT||
CINCINNATI, OH -- (Marketwired) -- 08/20/14 -- Ward Group, an Aon Hewitt company and the leading provider of benchmarking and best practices research studies for the insurance industry, conducted its annual business environment survey of insurance company executives to gauge their perspective on the outlook for the insurance industry. Results showed that profitability remains a primary goal of senior leadership in the life, health and annuity, as well as the property-casualty segments, and confidence in the ability to grow revenue and increase profits continues to improve.
The survey focused on how companies are adapting to current economic conditions, examined the challenges and concerns of senior management, and identified where companies are targeting their resources.
"It is clear that companies are making significant investments in technology and hiring staff to meet new business opportunities," noted Jeff Rieder, partner and head of Ward Group. "It will be important for companies to continually measure the success of these initiatives and have employee compensation programs that are aligned with goals to drive results."
Notable findings from the survey include:
- Companies maintain an optimistic outlook:
- 86 percent of property-casualty participants and 94 percent of life participants responded that the industry is about the same or better now than one year ago.
- Only 14 percent of property-casualty participants and 6 percent of life participants felt the current state of the industry is worse than 2013.
- Technology spending is expected to increase by a wide majority of companies:
- 82 percent of property-casualty and 79 percent of life participants are expecting increases in technology spend.
- Commercial underwriting, actuarial and marketing spend followed as the largest expected increases for property-casualty companies by 44, 39 and 35 percent of companies, respectively.
- Enterprise risk management, actuarial and marketing spend followed as the largest expected increases for life companies by 41, 39 and 34 percent of companies, respectively.
- The prolonging low interest rate environment and its negative impact on investment returns continue to be a challenge for the future for both property-casualty and life.
- Profitability and policyholder satisfaction ranked highest in level of importance among the participants, followed by agent satisfaction.
- The most common concerns/challenges facing companies in the future identified by participants are:
- Keeping up with technology needs and managing the associated costs
- Maintaining profitable growth
- Handling exposures related to catastrophes and increasing medical costs
- Uncertainty regarding the regulatory and legal environment
- Low interest rates negatively impacting investment returns
- The impacts of Healthcare Reform
- Recruiting and retaining talent
For a copy of the 2014 Business Environment Survey results, visit www.wardinc.com.
About Ward Group
Ward Group, a McLagan/Aon Hewitt company, is the leading provider of benchmarking and best practices studies for insurance companies. The firm analyzes staff levels, compensation, expenses and business practices for all areas of insurance company operations and helps companies to measure results, optimize performance and improve profitability. For more information about Ward Group and the Ward Research Center, visit www.wardinc.com.
About Aon Hewitt
Aon Hewitt empowers organizations and individuals to secure a better future through innovative talent, retirement and health solutions. We advise, design and execute a wide range of solutions that enable clients to cultivate talent to drive organizational and personal performance and growth, navigate retirement risk while providing new levels of financial security, and redefine health solutions for greater choice, affordability and wellness. Aon Hewitt is the global leader in human resource solutions, with over 30,000 professionals in 90 countries serving more than 20,000 clients worldwide. For more information on Aon Hewitt, please visit www.aonhewitt.com.
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