Companies in this industry underwrite insurance policies and annuities that are paid out in the case of death, illness, injury, or damage to property. Major companies include AIG, Anthem, MetLife, Prudential Financial, State Farm, and UnitedHealthcare (all based in the US), along with Allianz (Germany), Assicurazioni Generali (Italy), AXA (France), and Ping An Insurance (China).
Global insurance premiums written total about $5.2 trillion, according to Swiss Re. Insurance carriers are expanding into emerging markets such as China and India, where rising middle-class populations have spawned growing demand for insurance products. Other areas of the world are still facing economic uncertainty, which impacts insurance sales.
The US insurance carriers industry includes nearly 32,000 establishments (single-location companies and units of multi-location companies) with combined annual revenue of about $2 trillion.
Insurance agents and brokers are covered in a separate profile.
Demand is driven by demographics and commercial transactions, as well as by legal or financial requirements affecting customers. Consumers are usually required by states to buy auto insurance and by lenders to buy homeowners insurance, for example. Life insurers face an aging population, which could result in rising claims. The profitability of individual companies depends on effective marketing and on the ability to accurately estimate future payments. Large companies have big economies of scale in administration and in access to capital, as well as advertising and marketing. Small companies can compete successfully by specializing in particular products or industries. The US industry is concentrated: the 50 largest companies generate about 65% of revenue. Concentration is higher in some industry segments.
The competitive landscape for health insurance companies around the globe has been altered by payment reform efforts, including US efforts to extend health care coverage to more people. Elements of the US Affordable Care Act include expanded state Medicaid programs, elimination of some exclusions such as pre-existing conditions, and efforts to tighten coverage and payment rates. Managed care companies compete for customers in new government-run health exchanges, where small companies and individuals can buy health care coverage.
Products, Operations & Technology
Major products include health and accident insurance, generating most of the industry revenue (about 45%), followed vehicle property and liability insurance
Sales & Marketing
Finance & Regulation
Regional & International Issues
Also includes the following chapters:
Quarterly Industry Update
Trends and Opportunities
Call Preparation Questions
Glossary of Acronyms