9th January 2019

Conning study says US Life-Annuity industry has been redefining itself to respond to pressures and build value

The US Life-Annuity industry has been redefining itself to respond to pressures and build value, according to a new study by Conning.
"Life and annuity insurers have enjoyed almost a decade of positive statutory income following the recession of 2008," said Terence Martin, a director, Insurance Research at Conning. "Over that time, insurers have pursued both organic and inorganic growth strategies to increase net income. Organisational repositioning has been a particular focus-especially for stock insurers-resulting in mergers and acquisitions, and in insurers shedding unwanted books of business."
The Conning study, "Life-Annuity Value Creation Strategies: Reorganization and New Players" analyzes the inorganic strategies that insurers have used over the last decade to increase net income and create value for their policyholders and stockholders.
"We analyzed insurer repositioning actions that, in aggregate, impacted more than 25% of US Life-Annuity industry assets and premium as of the end of 2017," said Steve Webersen, head of Insurance Research at Conning. "That analysis found that the key drivers of repositioning activities were regulatory pressure, shareholder pressure, and pressures from annuity volatility. Insurer exits from certain lines and businesses have created opportunity for new entrants to provide capacity to absorb increasingly complex closed blocks of business. For many of these new entrants, the attraction to the life-annuity industry has been the ability to buy and grow asset management businesses."
The study is available for purchase from Conning by visiting www.conningresearch.com.

Conning Trends(124 articles)