Canadian Industrial Outlook: Insurance—Winter 2018 The Conference Board of Canada, 13 pages, April 5, 2018 Report by Richard Forbes

Canadian Industrial Outlook: Insurance—Winter 2018

The Conference Board of Canada, 13 pages, April 5, 2018
Report by Richard Forbes

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This report examines the short-and medium-term economic and profitability outlook for Canada’s insurance industry. Document Highlights Interest Rates—Canadian interest rates will continue to rise until 2020, which will increase investment revenue for insurers. Although higher interest rates will lead to slower consumer spending on big-ticket, insurable goods, they are a net benefit to insurance carriers. Aging Population—Canada’s growing population of aging baby boomers will lead to a rise in death benefit claims in the coming years, sharply increasing costs within the life and health segment. Life insurers will thus be challenged to use the most cutting-edge technology to attract enough new enrollees from younger generations to maintain profits. Claims Processing—Processing of many claims is becoming more automated as insurance start-ups are using artificial intelligence programs to settle claims almost immediately. These small, tech-savvy firms continue to challenge large incumbents that rely primarily on legacy systems.

This report examines the short-and medium-term economic and profitability outlook for Canada’s insurance industry.

Interest Rates—Canadian interest rates will continue to rise until 2020, which will increase investment revenue for insurers. Although higher interest rates will lead to slower consumer spending on big-ticket, insurable goods, they are a net benefit to insurance carriers.
Aging Population—Canada’s growing population of aging baby boomers will lead to a rise in death benefit claims in the coming years, sharply increasing costs within the life and health segment. Life insurers will thus be challenged to use the most cutting-edge technology to attract enough new enrollees from younger generations to maintain profits.
Claims Processing—Processing of many claims is becoming more automated as insurance start-ups are using artificial intelligence programs to settle claims almost immediately. These small, tech-savvy firms continue to challenge large incumbents that rely primarily on legacy systems.

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