The Risk Management, Insurance Advisory and Consulting industry is composed of operators providing insurance services on a contract or fee basis to insurance companies and other clients engaged in underwriting or reinsuring policies. Over the past five years, the industry has posted strong revenue growth as the economy has continued to strengthen since the recession. According to IBISWorld Industry Analyst Evan Hoffman, "A consistent increase in corporate profit and an increase in downstream insurance activity, especially with the passage of the Affordable Care Act, has sustained revenue growth over the five years to 2016."
Typically, insurance markets move through eight-to-10 year cycles in which insurance premiums rise or fall in price. However, the onset of the recession prevented prices from increasing and insurance funds kept prices low to attract new business through heightened price competition. Therefore, profitability fell as demand for insurance products was slow to rise and low prices prevented insurance funds from recording strong profit growth. However, more recently, insurance premiums have been trending upward, causing industry profit margins to balloon. Consequently, demand for risk management, insurance advisory and consulting services has risen, leading to strong profit growth for industry operators. Industry revenue is expected to grow an annualized 7.0% to $32.8 billion over the five years to 2016, with expected growth of 3.2% in 2016 alone.
Over the next five years, conditions are expected to continue to be favorable for industry operators. "Insurance premiums will likely rise, boosting their spending power and increasing demand for industry services," says Hoffman. Furthermore, stronger construction activity and new regulation (i.e. the Patient Protection and Affordable Care Act) will boost demand for services. Overall, industry revenue is forecast to continue growing during the five years to 2021.
Downstream industries impacted:
Life Insurance and Annuities
Health and Medical Insurance
Follow IBISWorld on Twitter: https://twitter.com/#!/IBISWorld
Friend IBISWorld on Facebook: http://www.facebook.com/pages/IBISWorld/121347533189
IBISWorld industry Report Key Topics
The Risk Management, Insurance Advisory & Consulting industry provides insurance advisory and risk management services to insurers and other businesses.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Globalization & Trade
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
About IBISWorld Inc.
Recognized as the nation's most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every US industry. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Los Angeles, IBISWorld serves a range of business, professional service and government organizations through more than 10 locations worldwide. For more information, visit www.ibisworld.com or call 1-800-330-3772.
Media Relations Specialist
+1 917-267-0351 Ext: 351
Logo - http://photos.prnewswire.com/prnh/20161107/436685LOGO
To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/ibisworld-industry-market-research-the-us-risk-management-insurance-advisory-and-consulting-industry-is-expected-to-earn-revenue-of-328-billion-in-2016-300358376.html
SOURCE IBISWorld Inc.