The insurance sector is at an important crossroads. It is currently in a period of increased competition and market pressure, meaning existing growth and profitability strategies are under strain. They need to find a way to cope with this market pressure but not stifle their future growth.
esynergy, a technology consultant that builds scalable platforms, products and services, recently launched a new whitepaper outlining how insurers can thrive in the current market – not just survive.
The whitepaper, ‘Unlocking tomorrow’s gains: Tech-driven strategies for Insurance leaders’, was created with support from in-depth interviews with senior industry leaders. It explores how insurers can preserve margins and build long-term resilience by strategically investing in data, governance, automation and a tech-driven culture.
Setting the scene, the report notes that the insurance sector is currently in a new phase of volatility and competition. Following a period of profitability, it is now in a period of greater competition and pressure. Economic instability and rapid technological change have transformed the industry.
The rising cost of claims and macroeconomic threats, such as climate change, are impacting firms. In fact, esynergy reports that in 2024, insured losses from natural catastrophes surpassed $135bn, the fifth consecutive year they topped $100bn.
Fortunately, we are in the latter part of the down cycle and the end is in sight. However, the existing growth and profitability strategies are under strain and firms are looking to maintain profitability through cost-saving investments. While the first thought might be to cut back on innovation and transformation, this will only be a short-term fix that could impact the firm’s growth in the next cycle, the whitepaper said.
It notes that long-term competitiveness could be impacted by cutting back on innovation and successful players are finding ways to cut unnecessary spending while doubling down on growth.
The whitepaper offers insights into how insurers can shift from short-term fixes to value-driven transformation that embeds AI, builds data infrastructure and aligns cross-functional teams. It covers how to balance cost-cutting and innovation, why data governance is vital for scalable AI adoption, how to avoid failed transformations and why digital fluency at the board level is a competitive advantage.
For more insights into how to excel in the current market, download the whitepaper here.
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