The innovative insurance company
By Andrew Barile
Andrew Barile Consulting Corporation
The recent insurance company market dislocations have created the ideal environment for success as an innovative insurance company. The bottom line is that the innovative insurance company performs and executes on market opportunities to secure underwriting profits as it is poised for a hardening insurance pricing market. It seeks opportunity on a proactive basis by utilizing informed analysis and judgment to make profitable decisions.
With a 40-year historical insurance industry perspective, a can-do attitude is transparent and necessary throughout the innovative insurance company's organization. That is what 40 years have taught me. The innovative insurance company is not only aware that an underwriting cycle is now nearly upon us, but also in which segment of the market this is likely to happen. The soft market for P&C insurance is essentially over, and rates will begin to stabilize. If $50 billion of capital has left the reinsurance industry, then rates in the reinsurance market will also increase.
The innovative insurance company will have the necessary capital to write the business at the new, historically higher rates. Insurance industry history has shown that poorly performing insurers were not adequately capitalized to write business when the cycle turned.
The innovative insurance company will take full advantage of both technological improvements and the entire spectrum of outsourcing. Global insurance platforms are available whether they be purchased from AIG or XL Capital, or from any other undervalued worldwide insurer. Seeking these opportunities is tantamount to a necessary proactive attitude.
The innovative insurance company's insurance asset management outsourced team must focus on improving investment income. Capital of poorly managed insurance companies has been eroded by unrealized losses from widening credit spreads across virtually all classes of corporate bonds. The innovative insurance company does not make these financial mistakes.
In these challenging times, the innovative insurance company has a very real opportunity to demonstrate their true value.
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