"Globalization" of financial services can have a significant impact on the insurance market, but how will it affect insurance agents?
Every day, we hear more about “globalization of insurance” and the opportunities it brings for growth. Obviously, insurance and financial services are already in many ways global operations, with many dozens of companies considered “multinational.” These insurers have on their books not only the split-level home in Nashua, N.H., but also the office building in Mumbai, India. More and more companies will realize they can continue spreading the risk beyond the borders of the United States, improving their diversification.
The question becomes, how does it affect an local insurance agency, dealing with customer relationships that were launched generations ago? And do insurance agents need to be concerned that their time-honored services will go by the wayside?
Doubtful. Insurers recognize that many consumers appreciate their agents, someone who lives in their town, knows their needs. Even if a company’s financial future lies in going global, it’s acknowledged that its past and present were built by personal connections. There are enough facets of the insurance industry to preserve the system that has helped so many for so long. Just as politics continues to be local, so shall insurance, in many ways.
However, this is not to say that agents and smaller companies don’t need to be fully aware of the ongoing and growing interaction of their own insurance markets with the larger financial services community. All are part of the system and the functioning of one depends upon the cooperation of all others.