As the insurance industry struggles with technology, its leaders are worried about the pace of technological change in their industry and are worried it won’t keep up. Those are the findings of Pricewaterhouse Coopers’ 21st Global CEO Survey, as reported by The Financial.
The survey finds insurance CEOs are concerned that actual industry growth has not lived up to expectations. The report, titled “the next big leap,” explores how insurance companies can reinvigorate revenue growth, while still driving down costs.
Key findings of the PwC report:
- Half of insurance CEOs believe that global economic growth will improve over the next 12 months, up from only 19% in 2017
- Insurance CEOs 3 biggest concerns are over-regulation (95%), cyber threats (93%) and speed of technological change (85%)
- More than 80% of insurance CEOs are concerned about shortages of digital skills within the industry and within their workforce, which is the highest percentage of any industry
- Nearly half (49%) of insurance CEOs are planning a new strategic alliance or joint venture to drive profitability and growth over the next 12 months
“Among the many reasons for the high confidence of CEOs in the insurance industry is that the anticipated disruption from incoming competitors, like InsurTech and digital platform players, hasn’t materialised like the industry initially feared,” said Stephen O’Hearn, PwC’s Global Insurance Leader. “Partnership, not rivalry, with new entrants is the order of the day.”
More of the insurance CEOs who responded are concerned about the pace of technological change (85 percent) than leaders in almost any other industry. The grounds for the CEOs’ optimism also include the increasing digitization of the global economy that opens up new opportunities. For example, demand for cyber insurance is increasing – 40% of CEOs from across all industries are now extremely concerned about cyber threats, compared to 24% in 2017. In turn, there are openings for insurers to become the ‘orchestrator’ of services such as mobility or internet of things-enabled smart homes.