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March 28, 2012 at 07:46 AM
Both public and private insurers, asset managers, distributors and consultants strove to take the collective temperature of the asset gathering industry while highlighting expected trends at UBS’s seventh annual Asset Gathering Conference held in Boston from March 22-23.
American International Group (AIG), Lincoln Financial (LNC), MassMutual, McKinsey, MetLife (MET), Milliman, and Principal Financial Group (PFG) all took part in the information sharing forum. The main themes that emerged for the industry were a focus on profitable growth and the increasing importance of proper risk management.
Within in the growth spectrum, AIG expressed the attractiveness of the retirement savings market and its potential to grow from $16 trillion to $20 trillion in 2015. Profitability, while always crucial to the health of any company or industry for that matter is exceedingly important today, according to AIG, because of low interest rates and high market volatility. MET concurred and said that profitable growth is “the key going forward” and any sales discussions must include returns on those sales.
MassMutual touched on the second overarching theme to emerge, the increasing importance of risk management. In the aftermath of the financial crisis, risk management has come to the forefront as a preeminent issue for individual companies, ratings agencies and investors alike. MassMutual described how it is essential that insurers manage capital risk, earnings risk, liquidity risk and franchise risk in order for them to be effective. They also stressed the importance of determining the level of risk that they can tolerate and implementing a strategy throughout the firm that embeds risk management within each individual business line.
