As the life insurance firms leverage the last bits of arbitrage opportunities created by the risk pool of their policy owners there comes a new technology revolution to aid in creation of blue oceans for them. At the same time it requires heavy investments. So should you engage or wait and watch?
The Life Insurance industry at its core has operated on three legs – 1) Operational Efficiency 2) Old School Customers and 3) Market Efficient Investments. Lately the industry has seen a dramatic shift largely due to the performance of the financial markets and the changes in customer behavior. A cursory analysis might result in a thought that the industry that has barely differentiated products can regain its competitive advantage by focusing more on the operational efficiency. But is it so? Here we speculate how the industry will play out given the new uncertainties that loom around the pillars it heavily relied on. And what can the players do to safeguard their interests and maintain sustainable advantage. Continue reading