McKinsey | --- | --- | --- | |--------------------------------------------------|-------|-------| | | | | | Insurance Practice Global Insurance Report 2025: | | | | Searching for profitable | | | | growth in commercial lines | | | Profitable growth is increasingly hard to find. Commercial property and casualty insurers need to be deliberate about where and how they compete. This article is a collaborative effort by Holger Wilms, James Polyblank, Shannon Varney, and Susanne Ebert, with Asim Bokhari, Nick Dig ...

McKinsey Insurance Practice Global Insurance Report 2025: Growth and relevance in life and beyond There are bright spots for growth in global life, retirement, and health insurance. But to combat stagnant demand, the industry needs to find new sources of growth beyond its core products. This report is a collaborative effort by Alex Kimura, Bernhard Kotanko, Henri de Combles de Nayves, Jason Ralph, Pierre-Ignace Bernard, and Ramnath Balasubramanian, with Alex Gestal and Ross Macdonald, representing views fro ...

November 2024 China Brief China Consumption: Momentum Amid Uncertainty Daniel Zipser, Senior Partner and Leader, Asia Consumer & Retail Practice Since my last China Brief, consumption has gained momentum, particularly with the unveiling of a series of economic stimulus measures since September 24. The highly anticipated annual Double 11 Shopping Festival, which ended on November 11, well exceeded industry expectations, further fueling excitement among industry executives around the pickup in consumption. De ...

Investment Rating - The report does not explicitly provide an investment rating for the industry Core Insights - The EU AI Act represents a significant regulatory step for AI systems and may influence other jurisdictions globally [1][35][36] - Organizations that establish robust AI governance are likely to experience annual growth rates of at least 10% [4] - A majority of organizations in the EU lack mature AI risk governance, with 71% of surveyed organizations indicating their governance is underdeveloped [5][17] Summary by Sections AI Governance and Risk Management - Only 30% of organizations consider their AI risk governance to be mature, with many lacking fundamental risk controls [6][22] - Concerns regarding AI governance include data, model output, security, third-party, and societal risks [6][10] - Less than 10% of organizations have fully addressed the key requirements of the EU AI Act [13][19] Implementation Challenges - Nearly 50% of organizations have not allocated any budget for EU AI Act implementation, with most budgets set at €2 million or less [15][20] - Key challenges include unclear obligations, complexity of regulations, and talent shortages [29][30] - Only 25% of organizations have implemented strategies for regulatory compliance or AI risk management [16][17] Data Management and Compliance - The EU AI Act introduces requirements for data management, including bias examination and ensuring representative data use [23] - More than half of the surveyed organizations have not yet addressed data governance requirements [22][23] - Organizations are encouraged to define their governance and compliance strategies to align with the EU AI Act [32][33] Future Outlook - The EU AI Act is expected to serve as a blueprint for AI regulation in other jurisdictions [1][35] - Organizations are advised to accelerate their planning for compliance to avoid chaos as deadlines approach [30][31] - Embracing responsible AI governance can foster innovation and build trust among stakeholders [36]

McKinsey & Company Insurance Practice Steering Indian insurance from growth to value in the upcoming 'techade' November 2024 Copyright © 2024 McKinsey & Company. All rights reserved. Cover image: © blackdovfx/Getty Images All interior images: @ Getty Images - 07 0 - Introduction ndia is a nation of immense scale, boasting the world's fifth-largest economy and a population exceeding 1.4 billion.' Its youthful demographic, with a median age below 28, is a catalyst for transformative change. The country is und ...

Investment Rating - The report indicates a cautious outlook for the fashion industry in 2025, with revenue growth expected to stabilize in the low single digits, reflecting a sluggish growth environment [28][30]. Core Insights - The fashion industry is facing a tumultuous and uncertain 2025, characterized by a cyclical slowdown, increased price sensitivity among consumers, and significant shifts in global trade dynamics [25][26]. - Despite challenges, opportunities exist for brands that can adapt quickly to market changes and consumer preferences [27][40]. - The McKinsey Global Fashion Index forecasts that non-luxury segments will drive economic profit growth for the first time since 2010, indicating a shift in market dynamics [28]. Industry Outlook - Revenue growth for the fashion industry is projected to remain low, with expectations of modest increases primarily driven by volume rather than price [49][50]. - Fashion executives are prioritizing differentiation strategies, including localization of go-to-market models and broadening price ranges to capture diverse consumer segments [51][52]. - The report highlights the importance of engaging the "Silver Generation" (over 50 years old) as a growing consumer cohort with significant spending power [35][54]. Global Economy - The report notes a significant increase in trade barriers, with a fivefold rise since 2015, impacting sourcing strategies for fashion brands [70]. - Rising costs and geopolitical tensions are prompting brands to diversify their sourcing away from China, with a focus on nearshoring and emerging markets in Asia [68][69]. - Shipping costs have surged dramatically, with a 165% increase in Asia-to-US shipping rates observed recently, further complicating supply chain dynamics [71]. Consumer Shifts - The report identifies a shift in consumer behavior towards value-driven purchasing, with increased interest in resale and off-price segments [31][54]. - AI-powered curation is expected to enhance product discovery for consumers overwhelmed by choices, improving engagement and conversion rates [34][54]. - The growing trend of cost-conscious shopping is likely to persist, influencing brand strategies to demonstrate value effectively [54].

Investment Rating - The report does not explicitly provide an investment rating for the Australian general insurance industry Core Insights - Australian general insurers are facing challenges such as frequent natural disasters, rising claims costs, and regulatory scrutiny, which are impacting their financial performance and making insurance less affordable for consumers [2][4] - To improve productivity, insurers should consider three major levers: enhancing labor productivity, improving IT productivity, and optimizing third-party spending [5][10] Summary by Sections Industry Challenges - The underwriting costs for general insurers have increased by approximately 20% over the last seven years due to climate risks and the need for compliance and technology modernization [3] - Costs have risen by about 20% for incumbents and 37% for international insurers, while challenger businesses have seen costs more than double [4][6] Productivity Levers - Insurers are expected to focus on efficiency and productivity improvements over the next three to five years, learning from global peers [5] - The three primary levers identified for driving productivity are: 1. **Labor Productivity**: Aligning 50-60% of the cost base to global best practices can lead to productivity improvements of 20-40% through zero-based redesign and strategic partnerships [11][12] 2. **IT Productivity**: Targeting 20-30% of the cost base through technology modernization and simplification can yield significant productivity gains [15][17] 3. **Third-Party Spend**: Optimizing procurement and external spending can target an additional 10-20% of the cost base [10][15] Implementation Strategies - Effective performance management is crucial for translating strategy into action, with global insurers demonstrating success through ambitious targets and visibility of key performance indicators [18] - Insurers are encouraged to ask critical questions regarding their productivity strategies and the role of technology in enhancing efficiency [18]

McKinsey & Company McKinsey on Lives & Legacies A corporate visionary, a retail CEO, and a fashion designer Our October obituaries also include a staunch advocate for older adults, a surgical innovator, and an award-winning photographer who enabled many to see underserved communities through a new lens. October 2024 trategic thinking is the cornerstone of leadership. The ability to conceive and execute a unique vision and chart a forward-looking path inspires many leaders to meet and exceed expectations. Ra ...

McKinsey & Company McKinsey Direct Turning a corner The State of Grocery Retail 2024 South Africa Contents 2 Foreword 3 The global context: Signs of recovery as consumer confidence returns 3 South Africa's grocery market: Potentially turning a corner after several challenging years 15 Implications for grocery players 1 Turning a corner: The State of Grocery Retail 2024 Damian Hattingh Daniel Läubli Gokmen Ciger Pauline Carrion The grocery retail market in South Africa has been under sustained pressure for s ...

Investment Rating - The report indicates a significant economic disadvantage for Europe in the tech IPO market compared to the US, suggesting a need for strategic improvements to enhance competitiveness and economic growth [2][4]. Core Insights - Europe has experienced a substantial economic loss due to tech companies opting for US listings, with a total capital raised through IPOs in the US being approximately 340 billion USD more than in Europe from 2015 to 2023 [7][9]. - The average market capitalization of tech IPOs in Europe is significantly lower than that in the US, with a ratio of 11.6 times higher for US tech IPOs [9][11]. - The fragmented nature of European capital markets is a key factor driving companies to list in the US, highlighting the need for a more unified and tech-focused exchange in Europe [2][58]. Summary by Sections Economic Disadvantage - Europe has a lower IPO market capitalization compared to the US, resulting from fewer listings and lower valuations at listing [2][4]. - The total market cap of tech companies at IPO in the US is 1,654 billion USD, while in Europe it is only 142 billion USD [11][9]. Venture Capital Landscape - Venture capital funding in Europe is underdeveloped, accounting for only 1.0% of GDP compared to 1.5% in the US [6]. - The report emphasizes that venture capital historically shows attractive long-term returns and is a key driver for economic growth [5]. IPO Market Performance - From 2015 to 2023, European tech IPOs raised significantly less capital than their US counterparts, with European companies raising only 22% of their total valuation through IPOs compared to 27% in the US [7][10]. - The average yearly tech IPO value in the US is substantially higher, with a peak valuation of 901 billion USD compared to 93 billion USD in Europe [10][11]. Market Fragmentation - The European stock market is characterized by a fragmented structure with 35 different exchanges, compared to only three major exchanges in the US [58]. - The lack of a centralized "European Tech company hub" contributes to the challenges faced by European companies in attracting international investors [58][61].