Porter Five Forces Insurance Industry
MGMT 5634: Porter’s Five Forces – Genworth Financial by DWAYNE McGRAW
Introduction:
Genworth Financial, Inc. (NYSE: GNW) is a leading Fortune 500 global financial security company. Genworth has more than $100 billion in assets and employs approximately 6,000 people with a presence in more than 25 countries. Its products and services help meet the investment, protection, retirement and lifestyle needs of more than 15 million customers. Genworth operates through three segments: Retirement & Protection (which includes Life Insurance, Long Term Care, and Fixed and Variable Annuities), U.S. Mortgage Insurance and International (which includes payment protection products). Its products and services are offered through financial intermediaries, advisors, independent distributors and sales specialists. Genworth Financial, which traces its roots back to 1871, became a public company in 2004 and is headquartered in Richmond, Virginia.
Competitive Rivalry: * Highly Competitive Industry * Large insurance companies offer similar products * Insurance products similar to commodity * Companies with low costs, operating efficiency, and superior customer service will be more competitive * Consolidation and M&A activity among the larger companies
Threat of New Entrants: * Difficult to enter insurance industry as a small “start-up” player due to capital and regulatory requirements * Large financial services companies such as banks or investment banks offering insurance products * Entrance of niche companies such as Life Settlement firms that buy existing policies
Power of Suppliers: * Suppliers of capital, such as reinsurers, control the cost structure of external capital which could cause difficulties with insurers to write new business * Threat of suppliers or other competitors hiring away key professional and executive talent
Power of Buyers: * Individual consumers are not a major factor * Brokers and
Introduction:
Genworth Financial, Inc. (NYSE: GNW) is a leading Fortune 500 global financial security company. Genworth has more than $100 billion in assets and employs approximately 6,000 people with a presence in more than 25 countries. Its products and services help meet the investment, protection, retirement and lifestyle needs of more than 15 million customers. Genworth operates through three segments: Retirement & Protection (which includes Life Insurance, Long Term Care, and Fixed and Variable Annuities), U.S. Mortgage Insurance and International (which includes payment protection products). Its products and services are offered through financial intermediaries, advisors, independent distributors and sales specialists. Genworth Financial, which traces its roots back to 1871, became a public company in 2004 and is headquartered in Richmond, Virginia.
Competitive Rivalry: * Highly Competitive Industry * Large insurance companies offer similar products * Insurance products similar to commodity * Companies with low costs, operating efficiency, and superior customer service will be more competitive * Consolidation and M&A activity among the larger companies
Threat of New Entrants: * Difficult to enter insurance industry as a small “start-up” player due to capital and regulatory requirements * Large financial services companies such as banks or investment banks offering insurance products * Entrance of niche companies such as Life Settlement firms that buy existing policies
Power of Suppliers: * Suppliers of capital, such as reinsurers, control the cost structure of external capital which could cause difficulties with insurers to write new business * Threat of suppliers or other competitors hiring away key professional and executive talent
Power of Buyers: * Individual consumers are not a major factor * Brokers and