Insurance companies have a once-in-a-generation opportunity to gain a competitive edge; but only if they're able to navigate a complex set of decisions in short order. Research, sponsored by State Street and conducted by the Economist Intelligence Unit, charts the way forward for Insurance companies – providing a blueprint for growth. This is a preview of those findings.

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Facing the Future: Blueprint for Growth
2013 State Street Insurance Survey Highlights
May 2013
This presentation features data from the
2013 State Street Insurance Survey,
conducted by The Economist Intelligence Unit.

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2013 State Street Insurance Survey
• This survey, sponsored by State Street and conducted by The Economist Intelligence Unit, examines
the current state and future outlook for the global insurance industry.
• Fielded during April 2013, the survey encompassed 307 insurance executives globally across all
industry sub-sectors. Half of respondents were C-suite, while the remainder were senior
management.
About the Research
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53%
9%
19%
7%
12%
Life
Health
P&C
Reinsurance
Diversified
26%
38%
36%
Americas
EMEA
APAC
Respondents by Region Respondents by Industry Sub-Sector

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Macro Trends Affecting Insurers Globally
Low Yield
Environment
Changing
Demographics
Technology &
Data
Regulation
Insurers recognize that they
must pursue younger
segments if they want to
grow, requiring a different
go-to-market approach.
As insurers seek ways to boost
their returns, they’re expanding
into new asset classes, which
requires new expertise and
risk models.
Many insurers have legacy
systems assembled through
acquisitions, which can hinder
transparency and limit
investment teams.
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Regulation can add
complexity, potentially
increasing costs and
decreasing the speed at
which a company can
develop new products.
Four key trends are affecting the insurance industry
and are causing firms to re-think their strategy.

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Strategic Priorities for Insurers
What is the Top Strategic Priority
for Your Business Today?
28%
37%
22%
27%
24%
15%
23%
31%
23%
25%
28%
17%
14%
12%
16%
14%
11%
11%
12%
11%
0% 20% 40% 60% 80% 100%
Global
Americas
EMEA
APAC
Enhancing product offerings
Strengthening distribution model
Proactively managing capital to improve return on investment
Expanding into new geographic markets
Optimizing mix of business lines and products
Source: 2013 State Street Insurance Survey 4
• Our research indicates that insurance firms
are optimistic about the future, yet face a
complex set of decisions today.
• Globally, the top strategic priority for insurers
is enhancing their product offerings (28
percent), followed closely by strengthening
distribution models (24 percent).
• Important regional differences exist. In the
Americas, enhancing product offerings ranks
at the top, while the No. 1 priority in EMEA is
proactively managing capital to improve
return on investment. In Asia, the most urgent
priority is strengthening distribution models.
Enhancing product, distribution and the proactive
management of capital are critical priorities for insurers.

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Five Challenges Facing Insurers Globally
Managing
Risk
Improving the assessment
and pricing of risks
Balancing liquidity
and reserve adequacy
Regulation
and
Compliance
Adapting to evolving
insurance regulations
Ensuring transparency of
business policies and processes
Driving
Innovation
Bringing new, innovative
products to market quickly
Adapting distribution to
changing demographics
Finding New
Sources of
Value
Effectively allocating capital to the
most business-critical priorities
Investing in more
complex investment types
Optimizing
Business
Strategy
Converting fixed costs
to variable costs
Using data more effectively
across our company
54%
59%
51%
49%
49%
58%
56%
50%
58%
53%
35%
21%
32%
26%
44%
23%
26%
29%
28%
22%
Minor challenge Major challengeSource: 2013 State Street Insurance Survey 5
Insurance companies face a number of urgent challenges,
amid a market and regulatory environment in flux.

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55%
41%
37%
21%
23%
26%
25%
29%
0% 20% 40% 60% 80% 100%
Re-price new business to adapt to market conditions
Redesign products to be less sensitive to markets
Make a large scale investment in IT systems
Divest non-core business
Evaluating for action within the next 12 months
Evaluating for longer term action (i.e., not within the next 12 months)
Four Strategic Actions Insurers are Poised to Take
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Which, if any, of the Following is
Your Firm Evaluating for Action?
Source: 2013 State Street Insurance Survey
Insurers recognize the need for change and are actively
re-positioning themselves for a new environment.

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Scenario A
Which of these statements do you believe will
be true for the insurance industry in five years?
Scenario B
National regulatory
regimes will converge
toward a global standard
Regulatory regimes will not be
harmonized; diverse national
standards will exist
The cost of regulation
will be mostly absorbed
along the value chain, not
passed to the end consumer
The cost of insurance industry
regulation will be passed
mostly to the end consumer
Insurers’ profitability will decline
Insurers’ profitability
will increase
There will be more mergers and
acquisitions in my market
There will be fewer mergers
and acquisitions in my market
31%
23%
15%
35%
8%
4%
4%
6%
36%
28%
31%
23%
3%
2%
11%
3%
60% 40% 20% 0% 20% 40% 60%
Looking Ahead
Note: The percentage of insurers responding “Neutral” or “Don’t know” for each scenario is not shown.
Source: 2013 State Street Insurance Survey CORP-0741
Very likely Somewhat likely
Insurers hold mixed views about the future of regulation,
but are optimistic about industry profit margins.
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