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I worked in insurance for approximately 5 years, and had a foray in reinsurance for 3. To this day, I find this to be an amazingly complex and interesting industry from an cash-flow perspective. Insurance is also a weird product from a consumer stand-point: for most people (at least in Canada) there is little to no difference between company offering. If you take P&C, there is a lot of competition for pricing, and a lot of the "end-stream" innovation is about containing costs (fraud, company-owned repair shops, avoiding litigation). Loss ratio is probably the word I heard the most from my actuarial friends. P&C and group insurance, since everything is renewed every year, see a lot more disruption and effervescence in the market. It's harder to disrupt life insurance when you're on the hook for 10, 20 or even 70 years. I think that participating life was a game changer, and even then, its popularity is really tied to the market. There is a lot of research being done as well to better assess risk without being invasive (fluids, extensive questionnaires, etc.). But when you're on the hook for a long period of time, your mistakes along the way tend to stay for a long time. And going under is -- I think -- worse than any other industry. You pay premiums to insurance companies because you trust they'll be alive in the future! Speaking of loss ratio, most companies are also now heavy towards automation, again to reduce costs. I know this has been over-played elsewhere in the industry, but here a lot of the key-players are massive and slow moving, and at their scale, little movement can mean a lot of change. |