June 20, 2018 11:30
Photo : Freepik
A new report published by KPGM International showed that 80 % of managers in insurance companies expect to make up to three acquisitions or partnerships over the next three years.
Entitled the Accelerated evolution – M & A, transformation and innovation in the insurance industry, the report has surveyed a total of 200 business leaders across the world.
“The majority of insurers intend to make acquisitions that could transform their organization for the future, rather than simply improving their business models and operating current,” said KPGM International. More than 60 % of the insurers reported that the transformation of their business or their operating model would be the key factor for acquisitions, while only 21 % indicated that they were simply wanting to improve their current model.
A competitive market
According to the head of global insurance at KPMG International, Laura Hay, insurers can only count on organic growth to achieve their goals. “Insurers are competing for market share in an environment of slow growth, which is experiencing an influx of new players dynamic insurtech. Alliances and acquisitions are becoming critical as insurers seek to interact with their customers in a different way. They have access to the operational capabilities and technology infrastructure to innovative to redesign their activity and stimulate growth. “
Transactions of the international favored
The report demonstrates that 66 % of insurers plan to conduct cross-border transactions, while 32 % plan to focus on the national markets. For partnerships and alliances over the next three years, 39 % of insurers have indicated that they are international, and 6 % contain national alliances.
KPGM International expects that most of the activities of mergers and acquisitions over the next three years will be mainly in North America, more particularly in the United States.