Large Insurance Companies In US
A handful of foreign multinationals such as AIG, Prudential (UK), ING, and Manulife, already have a sizeable share in a number of Asian markets and generate a significant proportion of their global profit from this region. However large their current market positions, these players still only occupy a small share of the overall Asian market, but their future growth potential remains very significant. Total market share of all foreign players across Asia is 25 percent in 2008, and we see this increasing to 30-35 percent within the next 10 years.
The leading multinational players share a number of characteristics. They all have big positions in the "first generation" of Asian markets that have been open to foreign companies (for example, Hong Kong, Singapore, and Taiwan), while some have been first movers in emerging markets such as Indonesia, the Philippines, and Thailand. They have built most of their operations organically, with only a handful of acquisitions over the years. All of them have built sizeable Asian management teams which are headquartered in Hong Kong.
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Life Insurance Companies In Asia - Smaller Foreign And Local Players
Life Insurance Companies In Asia
Chasing the large incumbents are the smaller foreign and local players. Most of these players have a much shorter history than the incumbents, and they have accumulated only single-digit market shares over several years. The strategic imperatives for these players depend on whether they are in more mature or nascent markets.
Chasing the large incumbents are the smaller foreign and local players. Most of these players have a much shorter history than the incumbents, and they have accumulated only single-digit market shares over several years. The strategic imperatives for these players depend on whether they are in more mature or nascent markets.
Life Insurance Growth In India - Creating New Growth Horizons
Life Insurance Growth In India
Beyond improving the core, which inevitably takes years to complete (and is very much an ongoing effort), incumbent insurers in Asia need to rebuild momentum and develop new growth options. They can look at new channels or business models, other businesses in financial services, and other markets to expand into. The challenges involved in making this work are enormous and cannot be undertaken where there is risk of undermining the core business or removing the focus away from the required improvements stated above.
The Asian life insurance incumbents are still relying largely on their massive sales forces - which are simultaneously a strength and a weakness. Of course, the enormous selling power of these agent forces is a huge advantage that incumbents need to build on. At the same time, other channels, notably bancassurance, have grown much faster than the agent channel in general. The often lower qualifications of incumbents' agents, compared to some attackers in the market, tends to hinder them when they try to sell the faster growing products such as investment-linked or health insurance. Across the region, local incumbents have a much lower share in bancassurance and alternative channels than in the agent channel. This might be surprising at first glance, but can be explained by the difficulty in managing channel conflicts. The agent sales forces usually have substantial internal power in these organizations that allows them to push back at the development of competing channels.
Beyond improving the core, which inevitably takes years to complete (and is very much an ongoing effort), incumbent insurers in Asia need to rebuild momentum and develop new growth options. They can look at new channels or business models, other businesses in financial services, and other markets to expand into. The challenges involved in making this work are enormous and cannot be undertaken where there is risk of undermining the core business or removing the focus away from the required improvements stated above.
The Asian life insurance incumbents are still relying largely on their massive sales forces - which are simultaneously a strength and a weakness. Of course, the enormous selling power of these agent forces is a huge advantage that incumbents need to build on. At the same time, other channels, notably bancassurance, have grown much faster than the agent channel in general. The often lower qualifications of incumbents' agents, compared to some attackers in the market, tends to hinder them when they try to sell the faster growing products such as investment-linked or health insurance. Across the region, local incumbents have a much lower share in bancassurance and alternative channels than in the agent channel. This might be surprising at first glance, but can be explained by the difficulty in managing channel conflicts. The agent sales forces usually have substantial internal power in these organizations that allows them to push back at the development of competing channels.
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