Nine in 10 insurance executives grade service equality and annual profitability as most vital when reviewing strategic alliances.
Inter-Company Marketing Group, Ashburn, Va., published this finding in a survey of 104 insurance professionals conducted in the fall of 2012. ICMG is a non-profit association that fosters insurance industry strategic alliances, the organization counting among its members marketing and business development decision-makers with insurance carriers, reinsurers, distributors, third-party administrators and service providers.
More than nine in ten (93 percent) of the insurance executives polled rate service quality by the strategic partner as “very important” or “important” among the critical success factors to be reviewed when deciding whether to renew a strategic alliance. A similarly large majority (88 percent) rank profitability as very important or important.
Most senior managers and/or managers of a division or line of business (93 percent) are involved in reviews of existing strategic alliances, the report states. Fewer non-managers are involved, among them professionals in the firm working on the alliance (35 percent), company sales force and/or distribution partners (32 percent), third-party reviewers of the alliance (12 percent) and boards of directors (10 percent).
A majority of the survey respondents indicated that a formal review presented to management (59 percent) and a review by professionals involved with the alliance (50 percent) are part of the alliance review process. Fewer of the respondents cite an informal review process (33 percent), a review by outside consultants and/or auditors (15 percent), a formal review presented to the board of directors (12 percent) or requests for comment from insurance ratings firms (3 percent).
More than four in ten respondents (44 percent) say they do not have established formal schedules for reviewing strategic alliances. Others insurance executives indicate they review alliances annually (33 percent), quarterly (21 percent), semiannually (13 percent) or monthly (12 percent).
When reviewing strategic alliances, the respondents cited as the most important factor to consider profit and revenue (23 percent), mutual benefit (18 percent), importance to the company’s strategy/alignment with corporate goals (18 percent), working relationships and people (17 percent), the partner’s reputation and capabilities (10 percent), value to the customer and cultural fit (four percent), distribution and product need (two percent) and service (one percent).