Not all insurers are equipped (or interested) in growing the enterprise through mergers and acquisitions, so organic growth remains the focus for the majority of property/casualty insurers. However, unless a carrier has prepared itself appropriately, meeting that challenge can prove elusive.
In Ernst & Young's "Property/Casualty Industry 2008 Outlook," Chris McShea, a partner with E&Y and co-author of the report, lists striving for growth as the number-one issue for carriers, followed by operational transformation, catastrophe solutions, financial events, Solvency II, and International Financial Reporting Standards.
The perfect scenario for growth in the industry, McShea believes, was achieved by carriers that performed a great deal of experimentation during the hard market when others were busy booking premium and replenishing their balance sheets. "During that time, carriers were able to evaluate those experiments with innovation in a controlled environment and selected those that had the best chance at success," he says. Carriers that followed such a plan are in some stage of bringing those innovations to fruition today, he adds.
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