"Protracted low interest rates, intensified regulation and growing demand of investors and stakeholders are all contributing to the challenges insurers face," said Kerzner. "But there is hope – demographics are in our favor and the need for our products has never been greater as more consumers recognize the financial risks they face and the value our products provide."
His remarks, given at the 2012 LIMRA Annual Conference in Chicago, emphasized the significant changes in the economic environment over the past five years and what the impact could be for the industry. He outlined that factors like low interest rates, the legislative and regulatory environment, and higher operating costs have led to greater risks for companies with potentially diminished rewards.
Kerzner noted that regulators worldwide were examining fiduciary standards and, in many countries, banning commission-based advisors. He predicted these changes could have cataclysmic impact on the financial services industry.
"Despite regulators and legislators pushing for a fee-for-service model, our research shows that consumers aren’t willing to pay for the actual cost of providing advice, which could drive good advisors out of the business," added Kerzner.
"But we know that advice matters – our research shows that consumers save more and at a higher rate when they work with an advisor," noted Kerzner.
The conference theme "Winning in the New Reality!" focuses on how industry leaders can address today’s unmatched challenges to steer their organizations toward a successful path.
More than 500 senior leaders from life insurance and financial services companies worldwide attended the industries' most preeminent meeting.
Catherine Theroux, 860-285-7787, email@example.com
LIMRA is a worldwide research, consulting and professional development organization that helps more than 850 insurance and financial services companies in 73 countries increase their marketing and distribution effectiveness. Visit LIMRA at www.limra.com