P- Political:

Threat to insurance is that the design of regulatory frameworks increasingly fails to clearly
distinguish insurance from banking and other financial services. This leads to the risk that
the insurance industry will increasingly be forced to comply with regulation that is not
optimally geared towards its business. Perhaps the most important threat though, is that
regulation fails to recognize the integration of borderless markets. As markets continue to
transcend borders, national regulation increasingly spills over from one local jurisdiction to
another leading to the risk of conflicting regulations. Moreover, differing local regulations
impair the realization of economies-of-scale and lead to excessive compliance costs. Local
and regional regulatory solutions should be questioned and new approaches that span the
supranational and global levels considered. Finally, I believe the only way to ensure that
regulation will be flexible enough to keep up with the dynamics of insurance markets is for
it to be principles-based as opposed to rules-based.

E- Economical: Creation of stronger demand

India’s improving economic fundamentals will support faster growth in per capita income in the
coming years, which will translate into stronger demand for insurance products
S- Social:
Social responsibility is the framework that businesses and individuals can contribute to
with the goal of making a positive impact on social, environmental and societal factors in
their communities, either at home or abroad. Social responsibility is not mandated, it’s
something that companies participate above and beyond their everyday business activities,
to not only help others, but to also encourage a positive work atmosphere and culture.

T- Technological: IoT and connected Insurance

Electronic channels, such as a client portal, make it easy for customers to provide
information to support claims using a simple upload and to find policy documents on their
terms: when they need them, and without having to contact the agent. Self-service has the
added benefit of freeing up agency staff to focus on higher value tasks.

L- Legal: Rules and regulations are getting tougher

State and federal agencies, along with the National Association of Insurance
Commissioners, continue to tighten the operational framework for US agents, and those that
operate outside the country have even more strict compliance obligations.
The Department of Labor Fiduciary Rule, which governs how an advisor deals with a client,
will be strengthened later this year, and the European Union’s updated Insurance
distribution Directive takes effect in October.
Cybersecurity regulations are getting tougher and, although they are not specific to the
insurance sector, data protection regulations — GDPR in Europe and the emerging Data
Security and Breach Notification Act in the US — are increasingly important to agents,
given how fundamental personal data is to their day-to-day operations.

E- Environmental:
When the insurance industry makes assessments regarding risk and the environment, they’re at
the forefront in documenting what is happening with climate change. With rising waters,
increased floods and natural disasters, the insurance industry can use this knowledge to better
communities for everyone. To support communities having to adapt to climate change, some
companies have even partnered with major Canadian Universities to create research projects to
gain knowledge that can be shared and used to support future policies. An example of such a
partnership can be seen in the creation of the Intact Centre on Climate Adaption.

Because of the insurance industry know-how and expertise, many insurance companies believe
that providing support and influence on environmental concerns is their civic duty. For this
reason, companies make their assessments and reports public in order to better serve the
community and local governments in making an impact for future practices and preventative
measures.