The authors of the paper point out that all segments of the financial industry have explored the use of alternative delivery channels, but at different paces. Insurance companies, for example, have traditionally relied on distributing products through a relatively costly agency network and are only now beginning to make greater use of telephone or electronic channels. In contrast, the banking and securities industry were early adopters of alternative channels, having success with home banking and online trading. While there is little doubt that agents are the preferred approach by many customers, notably senior citizens, there is strong evidence that this sales model is changing. The survey noted also that a fall in insurance premiums is a major factor for the lower cost of risk, adding that this fall in premiums is also forcing insurers to make competitive decisions that put additional pressure on industry profits.
Corporations continue to get even more for less.
The benchmark survey further indicated that the insurance industry's over capacity is creating more choice for risk managers. Risk managers, according to RIMS Past President Mark DeLillo, also are becoming involved in more business and strategic matters.