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ACORD Value Creation Studies

ACORD U.S. Property & Casualty Value Creation Study

The U.S. Property & Casualty insurance industry is the largest in the world, representing 38% of total global premiums. Not surprisingly, as the largest, it’s also very complex, with a large number of firms, different ownership structures, unique products, and multiple regulators. Given the complexity of the market, measuring value creation – much less understanding its drivers and implications – is extremely difficult. The ACORD U.S. P&C Value Creation Study was conducted to get at the essence of sustainable value creation and the characteristics of those who achieved it.

The study showed that more than $230 billion in value was created during the ten-year span evaluated in the U.S. Property & Casualty space, with those companies generating value (84) vastly outnumbering those who destroyed value (16). This represents a departure from previous editions of the study in which the number of value creating and destroying insurers was more evenly distributed.

“Several factors contributed to this shift, including an increased focus on underwriting profit, digitization, and the constantly changing macroeconomic conditions,” said Bill Pieroni, President and CEO, ACORD. “Increased alignment between strategic intent and capabilities is the key differentiating factor separating sustainable value creators from destroyers. We are finally seeing the true impact of decades of technology investment on results.”

Check out PropertyCasualty360's exclusive coverage of our U.S. P&C Value Creation Study, featuring an in-depth interview with Bill Pieroni.

ACORD Global Life Insurance Value Creation Study

The global life insurance industry is notoriously idiosyncratic among not only insurance lines of business, but across all sectors in general. The ACORD Global Life Insurance Value Creation Study leveraged in-depth financial analysis, data-driven research, and interviews with industry leaders to answer three key questions:

  • How have life insurers performed globally?
  • What metrics correlate to shareholder returns?
  • Which strategies and capabilities support high performance?

The study analyzed six years of data spanning 50 companies, 17 countries, over 20 lines of business, and 1/3 of global life NPW. By comparing multiple financial performance metrics and carrier attributes, we were able to highlight critical best-practice capabilities across the value chain.

“When we took a look at all the data, some of the implications were quite surprising,” said ACORD CEO Bill Pieroni. “The study showed that none of the traditional, commonly used financial metrics showed a statistically significant correlation to total shareholder return.” Instead, ACORD’s research found that characteristics such as business mix, M&A activity, and innovation-focused strategies corresponded most closely with successful value creation.