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"Global Insurance Report 2025: Life, Retirement & Beyond's Growth & Relevance"
2024-11-19
Life insurance is a crucial aspect of our lives, and in this comprehensive analysis, we delve deep into its various aspects. The past year has been a rollercoaster for the global life and retirement insurance industry, with unexpected economic conditions and shifts presenting both challenges and opportunities.

Uncover the Hidden Potential in Life Insurance

Life and Retirement in an Unpredictable World

The life and retirement industry has faced a tough time in recent years, with growth lagging behind global GDP and losing its significance in capital markets. However, unexpected macroeconomic resilience has provided some tailwinds, such as growing global GDP and decreasing inflation. But not all regions and product lines have benefited equally. There are bright spots of growth around the globe, especially in the past two years. Overall, traditional products and major markets are stuck, and the industry is on a quest for growth and relevance.

For instance, in some developed countries, the aging "silver" population of people aged 65 and above is reshaping the life insurance market. At the same time, changing social norms and lifestyles, like fewer marriages and more dual-income households, are challenging the traditional model. But this also opens up opportunities for more flexible policies to cater to non-traditional family structures.

Regaining Relevance in Retirement

Higher interest rates and macroeconomic uncertainty have created a favorable environment for life insurance carriers to meet retirement needs. This new cohort of pre-retirees and retirees sees the fundamental value proposition of life insurance in a new light. It's a timely opportunity for insurers to provide stable and secure retirement incomes, holding onto accumulated assets that might have otherwise gone to asset managers.

For example, in certain regions, there has been a surge in demand for retirement solutions tailored to the specific needs of this aging population. Insurers are stepping up to offer comprehensive retirement packages that address not only financial security but also healthcare and quality of life aspects.

Integrated Wealth and Health Solutions

As customer preferences change across different demographics, the line between life and wealth solutions is blurring. Modern consumers want advisers who can handle all their financial needs. Insurers can leverage the synergies between life insurance, wealth management, and healthcare to offer a holistic approach. By doing so, they can meet evolving client needs and stay competitive in a dynamic market.

Take, for instance, how some insurers are combining life insurance with health monitoring services. This not only provides financial protection but also helps in early detection and management of health issues, enhancing the overall quality of life for policyholders.

New Avenues to Serve Customers and Advisers

Despite the increased attractiveness of life insurance, its penetration rate is declining. This presents an opportunity for insurers to reach out to more consumers and tell the story of protection. Advisers, too, are aging and need more efficient ways to serve their clients. Insurers are exploring different channels like worksite and digital distribution to lower costs and provide better service.

For example, some insurers are using data analytics to identify potential customers at worksites and offer them personalized insurance plans. This targeted approach helps in increasing customer acquisition and improving customer satisfaction.

The Flywheel across Insurance, Asset Management, and Capital

As life insurance and asset management converge, a "flywheel" approach is crucial for value creation. It consists of issuing insurance policies at scale, differentiated investment management, and capital management. Some insurers are aiming for a truly integrated flywheel model, while others need to focus on specific parts based on their strengths.

For instance, an insurer might excel in issuing policies quickly and efficiently while partnering with specialized asset managers for better investment returns. This combination helps in creating a self-sustaining cycle of growth and value creation.

In conclusion, life insurance carriers play a vital role in protecting against uncertainty and helping individuals build wealth. While the industry's relevance has declined, there are ample opportunities to harness emerging structural tailwinds and redefine their role. By building new capabilities and stepping into new adjacencies, insurers can ensure sustained growth and competitiveness in the financial services landscape.
What Insights Led to McKinsey's Generative AI Platform "Lilli"
2024-11-25
In nearly a century, McKinsey's wealth of insights and knowledge has served as the foundation for their groundbreaking AI platform, "Lilli." This episode of the At the Edge podcast delves into the development and implementation of Lilli, and how it has transformed the way McKinsey serves its clients. Erik Roth, a McKinsey senior partner and global leader of growth and innovation, joins Lareina Yee to share their insights.

Unlock McKinsey's Intellectual Property with Lilli

The Origins of Lilli

Lareina Yee asks, "What is Lilli, and how did it become one of the most-used tools at McKinsey?" Erik Roth explains that Lilli was born from the need to help McKinsey colleagues access the firm's best insights. As ChatGPT emerged, the idea of training it on McKinsey's own information took shape. Lilli started as a knowledge extraction and synthesis tool but has now become an orchestration layer coordinating various types of knowledge.It is tuned to McKinsey and client service, recognizing question intent and fine-tuning answers. This is achieved through a combination of large and small models in a software stack. Lilli's unique approach sets it apart from other generative AI platforms.

The Development Process

When they started, it was an experiment with a small team of only four. Now, over 150 people are involved. They learned from users through classical, observational, ethnographic research in four domains: high-performing teams, client development, distinctive client service, and maintaining high-quality communications.The user is at the center of the development process. Every element of the development pipeline is linked to a user-specific problem. This focus on the user has served them well.

Supporting Lilli's Adoption

Erik Roth emphasizes the importance of role modeling and using Lilli himself. There are 360-degree communication and adoption programs, from early learning to risk and legal assessments. Lilli user groups in offices send ideas, and there are training sessions and a how-to guide.

Unexpected Learnings

The McKinsey Tone of Voice agent is the most used in the beta group. It translates prose into McKinsey-quality writing, helping non-English-native speakers. This shows the potential for Lilli to enhance communication.

The Future McKinsey Consultant

Erik Roth predicts that future McKinsey consultants will be more tech-enabled, spending more time activating insights rather than doing analytics. They will be more empathetic and diverse, creating higher impact.

Data and Education

Data is crucial for generative AI. A CEO's concern about data led to advice on data architecture and curation. There will be a minimum viable organization with technology enablement, and education is needed to understand these technologies.

Building and Testing

There is a balance between building and learning. When launching Lilli, they started with a small group to learn and turn them into evangelists. They use iterative testing with alpha, beta, and LilliX groups to drive adoption.

Reasoning and Precision

While models may seem to reason, they don't yet. But in LilliX, they are running experiments with leading thinkers to build models that can reason.

The Name "Lilli"

Lillian Dombrowski was the first woman to get an MBA at the firm and helped create the archives. She was an innovator and instigator of global practices. Her name was chosen for Lilli, and it was later shortened.

Optimism about AI

Erik Roth is optimistic about AI enabling new business models that improve lives and create value. Natural-language capabilities will change how technologies integrate into businesses. As long as it's done safely and respects diversity, AI will bring new possibilities.
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Refer to the McKinsey Crossword: T Day | No. 208 with Interactive & Print Options
2024-11-26
When it comes to puzzles, there are two main avenues to explore. One can play the interactive version, which offers a dynamic and engaging experience. Or, for those who prefer a more traditional touch, downloading and printing the puzzles allows for a hands-on engagement. Each Tuesday, a new puzzle is added, providing a weekly dose of entertainment. It's even better to sign up and receive an alert each week when the next challenge is ready, ensuring you never miss out on the fun.

Unlock the World of Puzzles with Weekly Challenges

Interactive Puzzles: A Dynamic Engagement

The interactive version of puzzles brings a whole new level of excitement. It allows users to interact directly with the puzzle, making the solving process more immersive. For example, animations and sound effects can enhance the experience, making it feel like a game. Users can move pieces, click on clues, and watch as the puzzle unfolds before their eyes. This dynamic engagement keeps users hooked and coming back for more.

Moreover, the real-time feedback provided by interactive puzzles is invaluable. Users can immediately see if their moves are correct or if they need to adjust their strategy. This immediate feedback helps users learn and improve their puzzle-solving skills more quickly.

Printable Puzzles: A Hands-on Experience

Downloading and printing puzzles offers a unique hands-on experience. There's something satisfying about holding a physical puzzle in your hands and working on it at your own pace. The tactile nature of printable puzzles allows users to focus better and immerse themselves in the solving process.

Printable puzzles also provide a sense of nostalgia. Many people remember spending hours with pencil and paper puzzles when they were younger. By downloading and printing these puzzles, they can relive those memories and enjoy the same level of satisfaction.

Regular Updates and Alerts

Each Tuesday, a new puzzle is made available, ensuring that there is always something new to solve. This regular update keeps the excitement alive and gives users something to look forward to.

And by signing up for alerts, users can ensure that they never miss a challenge. They will receive a notification each week when the next puzzle is ready, allowing them to jump right in and start solving. This convenience makes it easy for users to incorporate puzzles into their daily routine.

See all puzzles
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