Industry Analysis & Industry Trends
The Global Insurance Brokers and Agencies industry is a critical part of the insurance market, distributing policies and providing advisory services to insurance underwriters and consumers. Given the transaction-based nature of the industry, revenue primarily depends on three factors: policy pricing, demand for insurance and the popularity of using agents and brokers in the distribution process. Despite a softening insurance market in recent years, operators' efforts to boost the industry's attractiveness as a purchasing channel have largely offset this trend. Consequently, over the five years to 2013, industry revenue is anticipated to grow at an annualized rate of 3.2% to reach $413.3 billion.
An estimated 86.8%... read more
Starting a New Business
The Global Life Insurance Brokers and Agencies industry operates with medium barriers to entry; however, barriers can vary depending on the area a new entrant may target. It is relatively easy for a small player to enter the market, but to compete with the industry's major players, an entrant must possess a significant level of capital to develop brand awareness, a distribution network, a broad line of complementary insurance-related services and a client base.
In the reinsurance market, where concentration is higher, competing with the industry's dominant players is even more difficult. Large agency and brokerage firms are required to invest heavily in a distribution network in order to obtain a significant retail presence in a geographically well-distributed market... read more