Survey Says Analysts See More P&C Mergers, Acquisitions

A global survey of insurance equity analysts found that 85% of respondents expect to see a significant rise in property and casualty (P/C) mergers and acquisitions this year, and Life insurers in particular that expand into emerging markets over the next three years are likely to be rewarded with superior ratings.

Published on April 14, 2008

The survey, conducted by Institutional Investor Market Research Group as part of Accenture’s High Performance Business research, questioned 100 leading insurance equity analysts in 14 of the world’s largest insurance markets about such topics as profit and growth strategies, capital utilization priorities, critical industry challenges, operational excellence and industry top performers.

Among the survey’s other key findings: More than three-quarters (77 percent) of analysts rate operational efficiency improvement – or “transformation” – programs as the most valuable use of capital after share-buybacks and dividend increases (cited by 83 percent of respondents). Nine out of ten (89 percent) P&C analysts cited climate change and environmental issues among the industry’s top three challenges, making it the most widely cited P/C industry challenge in the survey.

Serge Callet, managing director of Accenture’s Insurance practice, said “The determinants of success within the $3.7 trillion insurance industry are rapidly changing, as new threats and opportunities emerge both regionally and globally. We tapped the collective insights of these critical industry observers to deepen our understanding of how insurers can earn superior ratings and how they can achieve high performance in a challenging market environment.”