Similarly, the distribution side of the business also has its challenges in that nearly 400,000 employees are expected to retire from the insurance industry workforce in the next few years, and many of those positions could remain vacant as the industry struggles to attract younger talent.
Also adding complexity is the global regulatory environment. The report pointed out that the strong focus in many countries on conduct regulation and greater price transparency adds increased pressure on commissions. In addition, the push for greater fiduciary and sustainability standards also contributes to advisors’ reluctance to offer insurance products, the report said.
In fact, 47% of executives worldwide cited customer best interest as the greatest regulatory challenge they face. This was closely followed by analytics/modeling in risk compliance at 46%, data privacy at 45%, cyber security at 42% and market conduct rounded out the top five at 30%.
Additionally, fraud concerns increasingly has been on the minds of life insurers. More than three quarters (79%) of executives indicated that fraud is a concern for themselves and their companies. Sixty–nine percent consider claims and disbursements as the most worrisome type of fraud. And executives in every region, ranging from 57% to 80% cited this type of fraud as the most concerning.
Other frauds that insurers lose sleep over are new business fraud (37%), account takeover (17%) and beneficiary designation (11%).
The widespread incidence of fraudulent activity in the life insurance industry prompted Limra to develop FraudShare, a new tool to help insurers better detect and prevent account takeover attempts, Salka said.
And as life insurer realign, reimagine, and transform their companies for the future, the report suggested that they instill a pro-change culture, focus on the customer and think strategically about technology.