Bill Wilt, a widely respected former sell-side analyst, recently formed Assured Research, a business advisory firm “dedicated to delivering highly customized, financially-oriented, actionable research and analysis to insurance and insurance-investment professionals.”
Bill recently published an Essay on Growth – Growth is Dead, Long Live Growth! – that offers interesting insights into investor views of premium growth opportunities for property casualty insurers. It also addresses ways in which insurers might be able to leverage their opportunities.
In particular, he highlighted that cutting edge analytical tools and research offers insurers the insights that could allow them to move beyond “cycle timing” to become true growth companies.
From my perspective, Bill’s commentary also highlights another way in which insurance companies might differentiate their business model with investors.
As growth becomes a more common topic, the basic metrics of rate, unit and exposure growth trends by just a handful of lines of business may not be sufficient. Companies may benefit from providing additional details to allow investors to truly assess the potential of their growth strategies.
In looking for ways to provide that additional detail, insurers may find that the data that supported the decision to target specific market segments may also have value as part of the investor communications effort. (And if competitive intelligence is a concern, there are many techniques for appropriately using comparative data to illustrate management’s strategies without “giving away the store.”)