Slow global economic growth poses the greatest threat to the viability of the insurance industry over the next five years as firms struggle to grow revenues, a poll has revealed.
The survey of 65 companies by accountants Ernst & Young found that 'macroeconomic trends', including week growth across the world, were viewed as the biggest obstacle across the industry.
This is followed by uncertainty caused by the Solvency II regulations for the industry, which are not to be introduced until 2016 at the earliest. This broad set of reforms also raised the risk of corporate governance failures, the survey found.
Other risk factors highlighted include the impact of the eurozone debt crisis on the industry, and the ability of firms to retain talented staff. The operational risk faced by firms, and the availability and cost of capital are also ranked in the top ten.
The Business Pulse report found the biggest opportunity for the industry in the year ahead lies in improving distribution and product development to enhance revenues, including promoting the advantages of insurance to younger people.
Ernst & Young's global insurance sector leader Shaun Crawford said that, as insurers search for growth and revenue, they must optimise capital and asset liability strategies to remain cost competitive.
'Adapting to evolving market and regulatory change will be a challenge that requires employing new technologies and building flexibility into all aspects of our business,' he added.