Insurance industry market conditions from an expert veteran
By Andrew Barile
Andrew Barile Consulting Corporation
Some large retail insurance brokers are focusing on organic growth, and aligning their compensation with respect to the services they are providing to their clients -- the insurance buyer. Recruitment of the best insurance industry professionals remains a strategic focus, as well as improving efficiency and their margins with the use of new technology. Finally, acquisitions are always looked upon as a new opportunity.
Insurance has always been recession-proof as businesses and people need to purchase business. And, most retail insurance agents are focused on their clients paying premiums.
The good news is that insurance pricing with rate declines has begun to decelerate. Directors' and officers' liability insurance has seen pricing begin to increase along with other specialty lines, and Florida property insurance rates are stabilizing. So far, insurance companies will continue to be competitive in 2009.
Some large retail insurance brokers are increasing the use of their "India-back-office support operations" for some immense cost savings (for example, $20,000 per person per year personnel). These cost efficiencies reduce operating costs and improve margins for large retail insurance agencies.
Finally, retail insurance brokers are doing less in paperwork and more in productivity as they call on potential new clients. The recession will force producing brokers to change their methods of operation. Focusing on new revenues is the answer to the recession for insurance producers.
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