To become or remain a major player, insurers are expected to consistently deliver strong revenue growth. Vital strategies can include:
- Mergers and acquisitions
- Geographic expansions
- Product development
- Cross-selling
- Client retention.
There is huge potential for expansion into emerging markets, which are generally underinsured but increasingly affluent. In a mature market such as Canada, demographic changes are driving new product development.
It can be crucial across a range of different financial indicators to deliver strong and consistent earnings. Cost management, operational excellence, and the optimization of business operating models are all high on the agenda. Many of the larger insurers are complex, diverse entities that have been very successful in mergers and acquisitions, and in growing their product sets and geographic scope. Smaller insurers can and do succeed if they can focus on the markets and capabilities in which they excel.
The insurance industry is fundamentally concerned with the management of risk and is closely watched by a range of global, national, and provincial regulators. Insurance companies face challenges to improve the quality of their risk management, underwriting discipline, and risk pricing. In many cases, improvements are still required in the basic analysis, documentation, and reporting of risk. This is a growing challenge as the evolving industry standards of IFRS and reforms of capital standards and regulation place new demands on insurers for increased control and transparency.
KPMG is well positioned to help insurance companies manage these pressing business issues; our Insurance practice works with Canadian insurers on financial and regulatory reporting, mergers and acquisitions, tax management, risk management, and a wide range of organizational improvement strategies. We can also provide clients with the global resources to help them manage issues affecting international operations. Our teams of insurance professionals are available wherever our clients need them.