Headline News: Home & Auto

PR Newswire — June 18, 2009
- Challenges from Outside the System

HARTFORD, Conn., June 18 /PRNewswire/ — The property-casualty insurance distribution system has evolved to encompass many of the new ways of transacting business available to the customer, including new technologies and new forms of association and collaboration. Yet it is just this expansion of opportunity, and the lack of corresponding decrease in cost, that could well make the system vulnerable to disintermediation from external entities, according to a new study by Conning Research and Consulting.

“Each property-casualty distribution channel focuses on different elements of the insurance value chain,” said Alan Dobbins, analyst at Conning Research & Consulting. “While each solves a customer need well, and adds value to the insurer-client relationship, the net result is a fragmented market for insurance intermediation. This situation, coupled with a compensation system that has not been effective at promoting cost savings, could well allow entities external to and independent of the insurance industry to disintermediate and redefine distribution for property-casualty insurers in the future.”

The Conning Research study, “Property-Casualty Insurance Distribution:
Focusing the Value Proposition, Embracing Change,” presents the many distribution channels, analyzes their competitive advantages and their unique proposition to the insurer and the customer.

“In analyzing the current distribution landscape for property-casualty, along with the history of change, it becomes clear that while new channels and options continue to arise, there has been no significant culling of existing channels,” said Stephan Christiansen, director of research at Conning. “While it is not clear which channels should fall out in this process, it is very likely that the industry will not sustain the cost structure of this complex system for much longer. In fact, the longer this expanded system continues, the more attractive it is for external forces to enter and disrupt the entire system.”

“Property-Casualty Insurance Distribution: Focusing the Value Proposition, Embracing Change”is available for purchase from Conning Research & Consulting by calling (888) 707-1177 or by visiting the company’s web site at www.conningresearch.com.

About Conning Research & Consulting

Conning Research & Consulting provides insurance industry analysis to insurers and industry stakeholders. Its published research includes market coverage of 30 segments of the industry in addition to industry forecasting and identification and analysis of major strategic issues.
As a result of its wealth of experience and intimate knowledge of the insurance industry, Conning understands industry challenges and opportunities and provides in-depth analyses on a wide range of industry products and issues. The Conning name has represented excellence in independent insurance industry research for 50 years.
Conning Research & Consulting is a division of Conning, a provider of asset management and insurance industry research and consulting services to insurers. Conning is headquartered in Hartford, CT.
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SOURCE Conning Research & Consulting