德勤-2021年保险业展望报告（英文）-2021.1-36页_3mb

2021 Insurance Outlook Summary

Core Content

This document provides an overview of the insurance industry's outlook for 2021, focusing on the impact of the pandemic and how insurers are adapting to new challenges and opportunities. It highlights the importance of expense management, technology adoption, talent strategies, and regulatory compliance in the context of post-pandemic recovery and long-term growth.

Key Messages

• The pandemic severely disrupted insurer operations, forcing a rapid shift to remote work and virtual customer engagement while exposing gaps in digital capabilities and raising cybersecurity concerns.
• Expense management is now a top priority, with insurers aiming to cut costs and free up capital for innovation and recovery.
• The need to accelerate digitization has turned pandemic-related challenges into opportunities, pushing insurers to fast-track transformation plans.
• The speed of change and reliance on remote access may create new exposures, particularly in cyber risk and business interruption.
• Insurers must balance return-to-office plans with hybrid workforce strategies due to ongoing health concerns and uncertainty around vaccine availability.

Where Do Insurers Stand as They Enter 2021?

• The pandemic caused significant losses, especially in property-casualty insurance, with workers' compensation and small business premiums seeing sharp declines.
• Life and annuity sales also dropped due to the pandemic and interest rate declines, though some recovery is expected in 2021.
• Global nonlife premiums are expected to remain flat in advanced markets but grow in emerging markets.
• Insurers are now focusing on recovery and thriving, despite ongoing economic challenges, by investing in operations, technology, talent, and finance.

Expense Management Still Front and Center

• Cost reduction is a central theme, with 61% of insurers expecting to cut costs by 11–20% over the next 12–18 months.
• APAC insurers anticipate more stringent cuts (35% expecting over 20% reduction), while Europe and North America are less aggressive.
• Insurers are prioritizing recovery and innovation over broad cost-cutting, with spending differences based on region and technology type.

Product Development and Innovation

• New product types such as parametric policies are being explored to address pandemic-related risks.
• Personal lines are seeing innovation due to changes in driving habits and work environments, with a preference for customization.
• Younger buyers are particularly interested in broader coverage options, such as policies covering all types of transportation.

Distribution Strategies

• Direct online sales are gaining traction, with 40% of insurers planning to increase investment.
• Insurers are supporting agents and brokers through various means, including financial aid.
• Cybersecurity is a top concern, especially for remote sales teams, with North America placing it as the top priority, followed by APAC and Europe.

Underwriting Transformation

• Underwriting is moving toward AI, alternative data, and predictive models to enhance decision-making and transition to more strategic roles.
• Ping An Life Insurance serves as an example of advanced underwriting automation.
• North America leads in underwriting automation as a priority, though APAC and Europe are also investing.

Claims Virtualization

• Claims processes are becoming more remote, but virtual interactions are not yet a major differentiator.
• Fraud detection is a key concern, with many insurers looking to upgrade capabilities despite budget constraints.
• Partnerships with data providers, such as Zurich UK and Carpe Data, are helping to enhance claims processing and fraud detection.

Compliance and Regulatory Challenges

• Insurers face increased regulatory scrutiny in areas such as market conduct, business interruption, and workers' compensation.
• Artificial intelligence is under review, with regulators seeking transparency in underwriting and pricing algorithms.
• Climate change and data privacy are also growing regulatory concerns, especially in catastrophe-exposed areas and with the rise of data analytics.

Technology and Digital Transformation

• Digital capabilities are seen as lacking by 79% of insurers, with underwriting and claims teams most affected.
• Cloud migration is accelerating, offering benefits like cost efficiency, agility, and scalability.
• Insurers are moving to modernize legacy systems and adopt cloud-based platforms for core operations.
• Cybersecurity and data privacy are rising priorities, with "zero trust" and "security by design" principles being emphasized.

Talent Strategies and Workforce Adaptation

• The pandemic impacted workforce stability, with 60% of insurers experiencing furloughs, layoffs, or compensation cuts.
• North America saw the most significant workforce reductions.
• Many insurers are rethinking talent strategies, balancing return-to-office plans with hybrid models to ensure operational and financial resilience.

Conclusion

Insurers are navigating a complex landscape shaped by the pandemic's aftermath, economic uncertainty, and technological evolution. The focus is on cost management, digital transformation, and innovation to recover and thrive in the new normal. As the industry moves forward, cybersecurity, compliance, and talent management will remain critical areas of investment and adaptation.