Insurance businesses come in many forms, from motorcycle personal injury insurance firms to health insurance organizations and, more. But in 2022 in a post-pandemic world, “talent transformation,” a new reliance on the digital marketplace, and growing societal shifts, are rapidly accelerating as insurance companies of all varieties learn to adapt accordingly.
Says a new report, 2021 was an improvement over the previous year in that the U.S. experienced widespread vaccine deployment along with the easing of some COVID-19 pandemic restrictions. These were considered important catalysts that assisted in rebuilding the confidence of businesses while aiding in overall economic recovery.
But as it turns out, the pandemic is not yet over due to its many variants. That means a certain level of uncertainty will still plague the nation, and it might also serve to undermine the insurance industry’s overall outlook for 2022. In other words, no one is out of the woods quite yet.
“However, research shows that regardless of continuing pandemic concerns, insurers expect more growth in 2022 and beyond. But there remain non-COVID-19 problems such as regulation, a lack of talent, the new hybrid work-at-home part-time model, and changing consumer preferences.”, says Kahuna Workforce, a skills management software company. Success will depend on how good insurers are at managing emerging technologies and their investments in customers and stakeholders.
What’s important in 2022 and beyond is maintaining flexible work schedules, striking a balance between new automation and high tech with human interaction, and regaining customer trust in a still uncertain and anxiety-filled world.
Here are a few key observations about the insurance industry outlook for 2022 and indeed, the entirety of the 2020s.
Insurers Are Preparing for Accelerated Growth
All remaining concerns about the pandemic aside, many of the country’s insurers are counting on an economic recovery along with more digital tech investment in the first half of 2022 and beyond. Approximately one-third of the respondents to a recent insurance industry survey stated they expected 2022 to be a “significantly better” year than 2021. That’s the good news.
The bad news is that the ride could be plagued with some heavy turbulence. Challenges remain for insurers, from spiking inflation to climate risk, to rapidly changing customer preferences and purchasing habits.
Attracting Talent in a Hybrid Work Environment
The future of work is changing rapidly. Insurance carriers are now said to be considering “flexible return-to-work” situations while at the same time, attempting to attract the talent they need to maintain the highest insurance industry standards.
Talented people who also possess data analysis and high-tech skills are being aggressively sought out.
Insurers Still Need to Balance Tech with a Human Touch
While insurance companies of all varieties find themselves more dependent on data sources and emerging technologies to increase cybersecurity, and overall efficiency and expand their capabilities and resources, they are also cognizant of maintaining a human touch.
Customer service must be personalized even if it is digitally driven.
The Pandemic Has Created Opportunities
Fundamentally speaking, lots of insurance carriers are said to be taking steps to foster trust among “stakeholders.” This action will boost not only profitability but also retention. This goal can be achieved by providing greater company transparency on how they collect and utilize customers’ personal data.
Insurance companies should also become more proactive when it comes to achieving broad solutions to big societal issues including lessening the financial impact of future pandemics and narrowing coverage gaps when it comes to natural catastrophes like floods, hurricanes, and tornadoes.
Societal Pressure for Demonstrating Sustainability Progress
Insurance companies aren’t blind to concerns over sustainability. They are considered the “economy’s fiscal first responders” and as such are all too often expected to pay for major damages and to have the backs of those who are filing for ESG (environmental, social, and governance) events. Climatic events such as windstorms, floors, wildfires, and more, that occurred in 2020 alone, created $81 billion in insurance losses.
On a societal level, insurers of employment practice liability have found themselves covering the expenses on claims of worker discrimination, gender, race, age, and other governance concerns. This reflects a societal shift that all varieties of insurance carriers must be acutely aware of going forward in 2022 and beyond.
Insurers must address these same issues inside their own companies also. Scrutiny of the industry is said to be rising among customers, legislators, rating agencies, regulators, independent assessment firms, and more.
Transparency, social responsibility, and flexibility to change with the times will be the key to any given insurance company’s success.