Overview of the industry
Throughout Europe, this relatively slow economic growth and continued low interest rate environment is pressuring insurers as they seek paths to profitable growth, challenging existing business models, insurer investment strategies, product mix, business processes and operating structures.
A prolonged low interest rate environment poses a major threat to existing business models of life insurers by reducing investment income and squeezing product margins. As insurers watch investment returns dwindle from the impact of low interest rates, they will adjust portfolios and seek to increase yield without taking on significant added risk, most noticeably by seeking new consideration, and as insurers gravitate to real estate, infrastructure and other alternative classes, they must manage risk to avert the errors made in recent years.
Offsetting lower investment returns are continued opportunities for growth stemming from the demographic realities of an aging Europe and improving middle class opportunities in some pockets. Improving economic conditions in some regions is likely to bring higher motor and home sales and stimulate more business formation. At the same time, the large loss potential stemming from the growing severity of natural catastrophe events in the region adds to consumer and business demand for financial protection. Despite the increased threat to businesses, the cyber liability market is still relatively immature in Europe and represents a meaningful opportunity for growth.
We can identify five main trends in the insurance industry:
– Uneven economic recovery, recessionary threat remains
– Low rates continue, affecting life more than non-life
– Solvency II remains important, other regulations moving to forefront
– New needs as regulation impacts distribution, digital empowers consumers
– Digital and analytics key to future growth and profitability
Recruitment trends in the industry
The insurance industry has been impacted by high requirements in terms of regulation. This industry is facing high challenges and needs talent to take on those challenges. However, a career in the insurance business is not one that most young people intentionally pursue. In the next seven to 10 years, more and more institutional knowledge will be lost from the insurance industry as much of its old guard turns its attention to other life interest. Yet, recruitment efforts to attract and cultivate young talent have not kept pace with the number of top people in the insurance industry who will be making their exit within the next decade. There are two ways in which insurers can view this confluence of events: as a crisis, or as an opportunity. And those who are working to secure the insurance industry’s future by investing in young talent will insist that their own efforts are part of a larger push that is critical to sustaining businesses built on decades of hard work.
Asquare Partners has developed a strong expertise in the insurance industry over the last years through events, symposiums, university seminars but mainly by being passionate by the industry. Asquare Partners strives to be a strong partner within the insurance industry to connect talents and actors on the market. We work closely with our clients to strive to act as an extension of them. The key is getting to know our clients very well. We take extraordinary measures to meet with key executives and the hiring team to fully understand the drivers for any search, the company culture, mission and goals.