With economic, interest-rate and competitive challenges expected to persist through 2013, the title of Conning Research and Consulting's latest report aptly sums up the firm's recipe for insurance-industry success in a year marked by numerous headwinds: “Nothing to Be Gained by Waiting for Things to Get Better.”

The report's theme is reinforced perhaps most clearly when Conning discusses the investment landscape for insurers. “Continued low interest rates will drive investment yields and investment income lower. Companies will be increasingly compelled to find a way to move forward, no longer willing or able to wait for an improving interest rate environment,” the report states.

Conning adds, “We believe many companies had been planning on some reversion of interest rates to higher levels, which perhaps has led to some inertia. This inertia is reinforced by conservative investment policies and customary rules of thumb that limit significant change. With the Federal Reserve now pegging its securities purchasing activity to the unemployment rate and GDP growth, interest rates could remain low even longer than previously expected.”