The insurance industry is not ready to grapple with the rise of social media and changes in data handling, an international survey has found.
The insurance industry is not ready to grapple with the rise of social media and changes in data handling, an international survey by Towers Watson has found.
Global professional services company quizzed 533 people across the world, 20% of whom hold actuarial titles.
Respondents' greatest concerns were around capital management, regulatory constraints and economic volatility, but they felt prepared to deal with these.
They were though less ready for some other 'megatrends'. Only 29% felt well equipped to meet the impact of social media, 32% the growth of advanced technology such as 'big data' and 33% to deal with talent attraction and retention.
Towers Watson's managing director, risk and financial services Tricia Guinn said: 'A focus on capital management and regulations is familiar territory for insurance companies and therefore the least surprising finding in our survey.
'On the other hand, the rather low priority given to new and emerging trends raises the question of whether insurers are devoting enough attention to issues that may have a huge impact on the industry down the road.'
Guinn said there was increasingly rapid adoption of new technologies by consumers of all ages, and insurers 'need to quickly accelerate their strategies regarding emerging technologies or risk losing out to competitors both within and outside the insurance industry'.
Steve Shurety, the company's head of insurance management consultancy, said: 'Big data is another area where an insurance company can differentiate itself.
'There's great potential for looking differently at the data we already have, identifying new sources of data and seeing how we can use either to improve the bottom line or to give us a pricing, product or service advantage with the customer base.
'With so much focus on capital management and public policy, are insurers paying too little attention to the competitive advantage or disadvantage that will flow from new megatrends such as big data?'
The survey, conducted with the International Insurance Society, looked at the trends of most concern to insurers over the next five years in each geographic region and how well prepared they were to address them.
European respondents were more likely to consider regulations their greatest concern, while ranking talent issues lower did than the other regions.
Those in the Asia Pacific region were almost equally concerned about regulatory trends while giving comparatively higher priority to talent and social media.
North Americans were slightly less concerned about regulations, but more so about 'big data' and extreme weather events.