If you’ve been following the latest headlines on the insurance sector, you would have read that insurers are having a hard time in this Age of Globalization. They’re dealing with regulatory problems, geopolitical risks, demographic shifts, and low bond yields.
However, the good news is, they aren’t backing down. Armed with unique products, reduced handling charges, and technology, they are facing head-on the challenges of surviving in a globalized business landscape.
Is your insurance company just as prepared? If it isn’t, it’s time to start taking the necessary steps.
Research New Markets
A targeted marketing approach can help insurance firms achieve the intended results, especially if they are on a tight budget. The benefits are tremendous for insurance agents who specialize in a new market and for those who can adapt to the consumer behaviors in emerging markets. Of course, the trick lies in targeting the right market.
Take time to identify new markets that are opening up in your respective regions. Research consumer trends, needs and aspirations in these markets before adopting strategies to target specific customer pools. There are plenty of resources that can help you with this, like the local chambers of commerce, trade associations, business news, and financial research papers.
Localize
Localisation plays a key role in tapping into new markets. If you can connect with the local customer base, half your work is done. One way to do this is by understanding the local culture.
When AIG entered China with its subsidiary, AIA, in 1992, they tried to leverage on the Chinese’s moral code on responsibility and love to make inroads. However, this failed because the Chinese do not take well to discussions surrounding premature death.
So, do your research. Interpret the local culture. Pay attention to customs and sensitivities that might affect your strategies. Hire localization and translation experts.
Innovate
Whether you’re in a developed market or an emerging market, one essential tool for surviving in the globalization era is innovation. Insurers must focus on research and development, agility, and analytical decision making.
Traditional insurance products don’t have a bright future anymore. Therefore, it is necessary to focus on developing risk management services and value-added loss control. Think about re-engineering your products and evaluating the values they seek to fulfil.
Leverage On Existing Capabilities
Apart from innovating and creating new products, insurers must focus on making the most of their current capabilities, such as their product portfolios, talent, capital, and customer relationships. These capabilities must be introduced to markets that are identical or similar to your current market. You might even need to reshape certain business processes and retrain your talents to create a positive impact on your overseas markets.
As stated earlier, do not fear localization. Expand into newer territories and customer segments to market your current products. Identify new distribution channels to connect with a fresh customer base.
Whether you are a global insurer, an annuities specialist, or a retirement provider, you need to transform in order to thrive, succeed, and grow in the age of globalization and fast-paced technology disruptions. As you plan for your customers’ future, you need to plan for the future of your insurance company too.