The sector is also facing numerous challenges, encouraging wealth insurance players to constantly innovate and demonstrate resilience, in order to remain competitive and anticipate already today the wealth insurance of tomorrow. Luc Rasschaert, CEO of WEALINS, shares his insights in this article.
Increasingly complex wealth planning issues
All players in wealth management are facing increasingly complex situations, characterised by the phenomenon of the “Great Wealth Transfer” and the baby-boomers who will be passing on their wealth to the next generations over the next few years (nearly 30 trillion dollars of wealth). This situation creates opportunities and challenges to which Luxembourg life insurance companies, including WEALINS, can offer concrete solutions.
“The expectations of wealthy clients are constantly increasing and differ from one generation to the other. While the trend towards hyper-personalisation that we have seen in recent years will continue to intensify, we are also observing a change in behavior among younger wealthy clients. The latter are showing a growing preference for ethical, sustainable investments and the latest technologies,” explains Luc Rasschaert. This is undoubtedly having an impact on the way in which wealth insurance players support this clientele, both in terms of products (green investments) and services. “We can mention, for instance, the use of artificial intelligence to improve our processes, or the data analysis and management to ultimately gain in efficiency, performance and enhance the user experience”. It is through innovation that Luxembourg life insurance will be able to continue to stand out from the competition and remain an attractive European and international hub for cross-border life insurance solutions in the years to come.
Innovation has gained a central role in the strategy of wealth insurance companies in recent years, and has enabled some of them to make their mark: “At WEALINS, innovation is at the heart of our business, and we favour a ‘client-centric’ approach, constantly listening to the needs of our partners and their clients in order to create a unique digital journey and experience that meets their specific expectations”. The human factor will continue to play a crucial role in the wealth insurance sector, as will the business expertise of our wealth planning teams. This means anticipating and understanding the wealth aspirations of our clients, raising their awareness and providing them with the best possible support in terms of wealth structuring and wealth planning. This agility enables WEALINS to respond quickly and effectively to market demands, and to stay one step ahead in a particularly competitive sector.
While the development of the Luxembourg life insurance industry over the next few years is likely to be influenced by a number of factors, including innovation in the economic, regulatory and technological fields, collaboration within the wealth insurance & management ecosystem in Luxembourg will enable the industry to strengthen its position in Europe and internationally.
At a time when protectionism is on the rise, we need to strengthen the European single market by exploiting the ecosystem through strategic partnerships or consolidation, to foster innovation and productivity, and thus be more competitive on the international scene.
Collaborate to compete
As a leading financial center, Luxembourg has established a regulatory framework that ensures investor protection and has reinforced its transparency. These elements, combined with the country's political, economic and social stability (triple-A rating), are key to continuing to attract international clients.
In addition, “we are currently experiencing a consolidation among life insurance players in Europe, which would strengthen certain jurisdictions in the face of European and international competition. At a time when protectionism is on the rise, we need to strengthen the European single market by exploiting the ecosystem through strategic partnerships or consolidation, to foster innovation and productivity, and thus be more competitive on the international scene”, adds Luc Rasschaert.
Faced with these major changes, Luxembourg life insurance companies will need to capitalise on synergies of expertise, as well as on attracting new talent to address the current and future wealth management issues.