Post Europe: View from the Top: The battle for Ireland

The challenges for insurers too have been significant - not least as a result of significant weather events of winter 2009/10, which resulted in claims across the entire sector of more than €500m. While large in scale for Ireland, that is effectively the day job for insurers. After all, quality insurance is about insurers having the financial scale to manage large, infrequent events, giving customers outstanding service.

Challenges abound
Other challenges include fiscal challenges for the government, the introduction of a life insurance levy, the introduction of a levy on all health insurance customers - which has forced prices up without any benefit to either consumers or insurers - and the announcement of future regulatory change in the health insurance market, including the intent to sell the dominant state owned health insurer. This also comes at a time when the Irish Financial Regulator is reviewing the regulatory structures for all insurers. All in all, quite a busy period.

Resulting from these many and varied challenges there is one single and compelling lesson. And that is simply that there are no short cuts to success. The market, competitive and regulatory environments will continue to change and companies must be positioned to respond in all circumstances with outstanding customer service.

Standing out
Against this backdrop, and perhaps because of it, ‘leader brand' insurers have been able to differentiate themselves from other sectors and at least start to restore trust among consumers.

Insurers also continue to ensure prudent management of businesses with a strong focus on cost management. While some unsustainable pricing continues, responsible insurers are reviewing their pricing regularly and ensuring that the premium adequately reflects the risk underwritten. With such actions insurers are well positioned to respond to customer claims such as the significant weather events last winter.

We must also consider looking outside of the traditional insurance model and taking best practice from other sectors to ensure sustainable businesses with clear leadership strategies in place. Adopting best practice from other industries helps ensure that consumers continue to get what they deserve - outstanding products and service. A focus on innovation can also differentiate firms from competitors.

The battle continues
One final thought to consider. Although Ireland is a relatively small market with a population of 4.2 million people, it is a microcosm of the intensely competitive insurance world with a good proportion of the world's biggest insurers battling for the hearts and minds of consumers. No doubt the challenges will even intensify over the coming years and in this environment - and particularly at this point in the economic cycle - success will come from a relentless focus on customers, on product quality and delivering real value for money. In other words we must always ‘think customer'.

Jim Dowdall is Aviva's chief executive officer in Ireland