FORECAST 2025: Growth Opportunities
FORECAST 2025: Growth Opportunities
Author
Jennifer Rankin
Contributing Editor
LIMRA and LOMA
January 2025
What are the biggest growth opportunities for insurance companies and the industry at large? What is driving those opportunities? When we asked FORECAST 2025 participants those questions, they offered lots of possibilities.
Bridging today’s coverage gap is top of mind, as is expanding access.
Filling Gaps
“Thanks to LIMRA,” notes Kamilah Williams-Kemp, EVP & Chief Product Officer, Northwestern Mutual, “we know that over 100 million Americans are either uninsured or underinsured, and we know that many advisors are approaching retirement. Moreover, according to Northwestern Mutual’s Planning & Progress Study, we know that there is a wide gap between Americans’ retirement savings goals and their current savings.”
“The biggest opportunity for growth for Prudential, and across our industry, is one that centers around bridging protection gaps and expanding access,” says Caroline Feeney, EVP & Chief Executive Officer, U.S. Businesses, Prudential Financial. “In a time where customer and client needs, preferences and challenges are rapidly evolving, there is no question that the power and leadership of our industry are needed now more than ever before.
“For Prudential, this includes offering inclusive and easier access to tools, education and financial solutions to help improve an individual’s retirement readiness. It’s critical that through the advice and financial solutions we offer, we can meet customers on their terms and in the way they want to engage with us.”
“People need life insurance, and as LIMRA’s research suggests, there is a significant gap — many of those who want it can’t attain it — so there is a huge opportunity to solve this problem,” notes Marc Giguère, President & Chief Executive Officer, Munich Re, U.S. Life and Health. “Our industry can innovate faster than ever via the new information sources and technologies that, just a few years ago, seemed decades away but now are an everyday reality. I see great value in what we bring to society, and I'm excited about the potential to make it more accessible than ever before. The new products and avenues to attain insurance that are in development are going to shift industry dynamics, bringing the protection of life insurance to those who need it.”
“When we think about growth,” says Chris Blunt, Chief Executive Officer, F&G, “it’s not just assets under management (AUM), it’s about reach. Growing the numbers of customers we serve, growing our reach in local communities, growing our presence in the regulatory world as well as having the most engaged employee base.” He sees tremendous opportunity and demand for the products F&G sells. In addition, “There is a massive amount of cash sitting in money markets. Those yields are going to be going down as interest rates decline, so customers are going to look to lock in some rate. We think that bodes well for our core products.” Blunt also sees big opportunities in the fast-growing registered index-linked annuity (RILA) market, which F&G entered in early 2024.
In addition, consumers are wary of the risks posed by recent, current and prospective economic conditions and are looking for ways to offset that risk.
“Current and ongoing market and economic conditions speak to consumers’ need for risk mitigation products as well as products that offer some degree of protection against investment loss,” says Jasmine Jirele, President & Chief Executive Officer, Allianz Life Insurance Company of North America. “These conditions are causing more Americans to think harder about risks to their retirement strategy — risks that annuity, insurance and buffered exchange traded funds (ETFs) are able to address. That’s also the reason we are active in the employer market (adding annuities to employer-sponsored retirement plans). There is ample opportunity for growth in our business as we respond to these trends.”
Opportunity Knocks
“The biggest opportunity we always have is to deliver more value to our clients,” says Mike James, Global Chief Sales Officer, NFP, an Aon company. “The complexity that organizations and individuals face today — managing risk, attracting and retaining talent, managing wealth, planning for retirement — requires consultative advice. We always want to be a trusted advisor and go-to resource for clients who may know where they want to go but aren’t sure of the best way to get there.”
According to Bob Jurgensmeier, Chief Executive Officer, Ameritas Life Insurance Group, the “Peak 65” demographic group offers a significant opportunity for growth. Also dubbed the “silver tsunami,” peak 65 is a term used to describe the large number of Americans who will turn 65 in the coming years. The Alliance for Lifetime Income estimates that more than 4 million people will turn 65 each year from 2024 to 2027, the largest number of people reaching retirement age in American history.
“Peak 65 demographic trends, along with the corresponding wealth transfer expected to occur over the next decade and beyond, are and will continue to create opportunities for industry products,” he notes.
This ties into the need for trusted advice. Positioning your company to deliver just that opens all sorts of growth opportunities, says Jerry Lyphout, President & Chief Executive Officer, Modern Woodmen of America.
“The average U.S. citizen controls more wealth than ever before,” he notes. “Some of this wealth was acquired, and some was inherited. The majority of these individuals want assistance and seek guidance from a trusted source. Developing a strong distribution model to reach these people is key, along with developing a robust service model to retain your client base. Those carriers with a broad product offering focused on holistic planning will fare well.”
The middle market also offers opportunity for growth, notes Sarah Mineau, SVP, Life/Health & Investment Planning Services, State Farm Insurance. “The middle market has been underserved, a statement underscored by the well-established data point that 40 percent of American workers do not know where to go for financial and retirement advice.”
She also says that increasing life expectancies present an opportunity for insurers. “Increased life expectancy will give rise to the need for new insurance products and solutions for the aging population.”
On the product front, some FORECAST 2025 participants believe the lifetime income and employee benefits spaces present major growth opportunities.
“We continue to view lifetime income as a broad opportunity for the industry and Pacific Life,” says Adrian Griggs, EVP & Chief Operating Officer, Pacific Life. “This is due to demographic trends (retirements), along with the trend away from traditional pension plans, coupled with the inherent value of lifetime income in a retirement plan. For Pacific Life, this growth can come from retail, 401(k) in-plan annuities and international reinsurance.”
“From a growth perspective,” says Virgil Miller, President, Aflac U.S., Aflac, “consumer awareness and heightened expectations around benefit offerings from their employers present a great deal of opportunity. The 2024-2025 Aflac WorkForces Report, the 14th annual research study examining benefits trends and attitudes, backs this up. The survey, conducted by Kantar, captured responses from 1,003 employers and 2,000 employees across the U.S. in various industries. It found that more than 3 in 5 employees would consider leaving their job for one with more robust benefits, even if that involved lower compensation.”
Operational Transformation
“The biggest opportunity for Protective lies in our commitment to growth, transformation and efficiency,” says Wade Harrison, EVP & Chief Retail Officer, Protective Life. “By investing in these areas, we enhance our operational capabilities and build a stronger foundation for the future, benefiting employees, customers and stakeholders. Streamlining processes, reducing expenses and improving service delivery allow us to reinvest savings into innovative solutions and new growth opportunities. This makes Protective more competitive, ensuring we meet evolving customer needs and stay ahead of industry trends. Our growth-oriented approach positions us for long-term success and delivers greater value to all stakeholders by creating a resilient and agile organization.”
“We’re living through a period of extraordinary change and rapid technological development,” says Aaron Ball, EVP and Co-Head of the Foundational Business, New York Life. “The skills required to be successful in the future will differ from the skills that were needed in the past. As a result, we are transforming how we operate so we can be nimbler and deliver outstanding experiences for our customers. We are doing this by investing in our field force, modernizing our entire technology stack, building new data capabilities and adopting AI to ensure that every transaction is seamless, transparent and valuable.” New York Life also is deploying scaled agile and continuous improvement across the business and investing in its employees so they can build successful careers and keep their skill sets up to date.
As you can see, there are many growth opportunities in the financial services/insurance sector. Among the forces driving those opportunities are coverage gaps, demographics and fluctuating economic conditions. FORECAST 2025 participants currently are leveraging those opportunities — and will continue to do so.
