As mutuals step into the landscape of 2024, leading with robust, creative, and strategic planning for long-term success is paramount. The NAMIC 2022 Mutual Factor Report recently highlighted the impressive growth of the mutual insurance industry, setting the stage for mutual carriers to seize opportunities and overcome challenges in the year ahead. In this article, we explore three strategic pillars that will empower mutual carriers to navigate the remainder of the year and set the foundations for growth in 2024.
The outlook for mutual carriers
Mutual and mid-market carriers are facing a variety of disruptive trends and market challenges, with constant pressure to balance capital constraints and an urgent need to grow and transform their businesses. The NAMIC 2022 Mutual Factor Report found that the mutual insurance industry closed 2021 with a record surplus of more than 13% growth and hit a record $1.053 trillion in capital and surplus. These outcomes have positively impacted mutual carriers’ five-year compound average growth rate, elevating it to 7.4%. The report also determined that mutuals continued to return to pre-pandemic conditions and outcomes in 2022. Whether the success of the past few years stems from the return to business post-pandemic or simply effective strategies implemented by mutuals, these findings point to a promising future and indicate that mutuals are a thriving piece in the industry.
Even so, organizations are not immune to the challenges currently affecting the industry—hard market trends, regulations, talent and staffing, and differentiation, to name a few—which pose significant obstacles to sustainable growth. With the unpredictability of market changes, talent acquisition, and the competition’s success, the best way forward is to set goals, such as growth targets, and invest in areas that will contribute to reaching them. Unsure where to start? Here are the three pillars of mutual success that will be integral to focus on in the months ahead.
Optimizing with technology
So much of the industry’s growth is fueled by technology and its ever-evolving capabilities. For mutuals, choosing the right tools and products is the investment an organization needs, not only to keep up with the industry but to set the standard. Leading technology can streamline processes and increase an organization’s bandwidth. It empowers the workforce, whether remote, hybrid or in-office staff, and combats increasing claims severity and complexity, as well as prepares organizations for potential risks by providing diverse claims information. Harnessing the right technology and decision-support tools is a key differentiator in the marketplace for organizations, their employees, and their customers. If organizations expand their capabilities, either by leveraging artificial intelligence, partnering with a third-party administrator to use its products, or creating their own technology and systems, they have a better chance of staying ahead of the growing demands of the industry.
Technology creates buzz across the industry, drawing the attention of prospective customers, partners, and employees. Prioritizing innovation is perhaps the number one indicator of a forward-thinking organization, but more importantly, technology supports stable, goal-driven strategies, driving mutuals’ growth with data, insights, and the capability to deliver on their customers’ evolving and unique needs. By embracing emerging technologies, mutual carriers can enhance their operational efficiency, meet customer expectations, and position themselves as front-runners in the industry.
Elevating the customer experience
In an era where customer expectations continually evolve, delivering an exceptional customer experience is essential for mutual insurance companies to remain relevant and thrive in the marketplace. A seamless and personalized customer journey, supported by efficient communication, simplifies processes and effective claims handling, builds customer trust, and boosts overall customer satisfaction, leading to increased customer loyalty and positive word-of-mouth recommendations. After all, the promise to deliver on their expectations is what keeps them in the door and what piques prospective clients’ interest.
“Investing” in customer experience is not so much building or paying for a new product as it is a commitment to providing consistent and reliable service. To retain and attract business, mutuals need to prioritize customer satisfaction and create a “stable state” for their customers. They need to be the balance, or the constant, amid changing conditions, such as acquisitions and mergers, talent staffing challenges for both parties, and evolving needs. Customers should view the mutual insurance company as an extension of their team and a partner in achieving superior outcomes.
To thrive in 2024 and beyond, mutual carriers must forge a comprehensive growth strategy that sets them apart. The International Cooperative and Mutual Insurance Federation’s Key Statistics Report for 2023 highlights significant growth opportunities, reporting a 46.7% growth in premium volume since 2007, compared to the total insurance market growth of 36.1%. There are several areas of focus for mutuals to grow their business, with technology and customer experience being only two. What growth truly comes down to, however, is standing apart from the competition. In such a competitive industry, mutuals must focus on areas where they excel and how to best serve their customers. Whether this lies in being the best in a highly specialized line or fully serving their customers’ needs by offering multiple product lines, customers need to know how they can be supported and that their partner is capable of long-term collaborative growth. This only comes from careful strategic planning based on each organization’s unique growth targets and investing in the areas that matter most. Finding a partner that understands and supports this can be critical. To achieve sustainable growth, mutuals must prepare for today and, more importantly, for tomorrow.
To explore how these strategies can empower your growth in 2024 and beyond, book a free consultation today. Don’t miss the opportunity to delve into these strategies at the NAMIC Annual Conference from September 17 to 20, where Amy Cooper, Matt Schauer, Michael Stogsdill, and Bob Morris will be meeting with mutual carriers to map out their successful journeys into the future.