On 8th July 2013, researchers Plan For Life, released updated market share information on the leading life insurers in Australia. AMP, TAL, MLC and CommInsure (CBA) are the largest 4 insurers respectively in terms of existing clients and the premiums they pay. However, other than TAL, these insurers seem to be losing ground compared to the rest of the industry. Whilst the market is growing at just over 10% per annum, these insurers are growing at a slower rate, and in the case of MLC, only growing at 2.9%.
Experien Insurance Services monitors the market share of the leading insurers each quarter to help us judge their performance, before we consider recommending them to our clients. Whilst growth and market share are not the only, or perfect, barometers for measuring the merits of an insurer, it is often an important indicator of the company in terms of service, pricing or product features. An insurer that becomes uncompetitive or drops its service standard is likely to experience a loss of market share.
We investigate insurers intensively if they lose market share to understand the reasons behind the fall. It does not necessarily mean that all is not well, but it’s critical to understand if there are problems. On the other hand, insurers that rapidly gain market share are not necessarily insurers that should be given an overweight consideration in terms of their products. It might be caused by an overly aggressive pricing strategy that is not sustainable and which could be followed with large price rises later on. We try to avoid these situations where possible.
At all times though, we consider the personal situation of our clients and make a holistic assessment of which insurer is able to sustainably meet their needs in the best possible way. Whilst market share trends are one measure in the assessment, there are many others that we consider.
