Ireland's insurance CEOs that manage businesses serving domestic and international markets remain confident about their company’s prospects for growth but changes in industry regulation, the impact of Brexit and emerging technologies/InsurTech are set to become increasingly disruptive in the coming years.
This is according to the 3rd Annual Insurance Ireland/PwC CEO Pulse survey carried out amongst Ireland's insurance CEOs during the Summer 2018 having 35 participants representing international as well as local insurance companies and all classes of insurance.
Eighty three percent of Irish insurance CEOs are confident about future business growth, slightly down from last year (90%). This confidence is reflected in projected headcount expansion in the year ahead (61%) with nearly one in five (15%) planning to grow the workforce by more than 10%, although it should be noted that there may be variations across the industry in terms of company size and sector. Globally, 90% of insurance leaders are confident about future growth prospects in the year ahead; 45% expect to hire more people.
Over three-quarters (77%) are of the view that there are more opportunities now compared to three years ago, largely driven by the potential for expansion into new markets (34%). Product innovation and diversification are also seen as key opportunities for nearly one in five (17%).
Two-thirds (66%) of Irish insurance leaders believe that there are more threats to business growth compared to three years ago. Aside from Brexit, the survey highlights a noticeable sharpening of CEOs' views with regard to the extent of disruption in the industry in the years ahead in areas such as industry regulation (86%, up from 71% last year) and emerging technologies/InsurTech (74%, up from 63% last year.
Many expect continued disruption from changes in customer behaviours (54%), the new General Data Protection Regulation (55%) and changes in the international tax environment (46%).
Other significant concerns are low interest rates/poor investment performance, change management, the availability of key talent, cyber threats and accommodation/infrastructure constraints.
There has been a step-up in return on investment from digital technologies compared to last year in areas such as operational efficiency (91%, up from 80% last year); innovation capacity (83%, up from 63% last year) and strategic decision making (72%, up from 60% last year). At 34%, data analytics is seen as the emerging technology providing the single greatest opportunity, followed by InsurTech (20%) and artificial intelligence (14%).