Change management, technology and competition top the list of risks New Zealand insurers face, according to a PricewaterhouseCoopers (PWC) survey.

Competition ranks more highly in New Zealand than with respondents globally, where it is viewed as the eighth-biggest risk.

“It’s no surprise local insurers are feeling the effects of an increasingly competitive market,” PWC New Zealand Partner and Insurance Sector Leader Karl Deutschle says.

“Insurtech start-ups are bringing in new technologies to the market, and they aren’t held back by legacy systems or outdated business models.”

The report, Reinventing Insurance, One Step at a Time, offers a New Zealand perspective on issues facing the industry and is a supplement to PWC’s global Banana Skins series.

“Insurers are well aware they need to build solutions and products that are focused on the customer,” Mr Deutschle says. “However, their biggest challenge is to convert that awareness into reality.”

Survey respondents also nominate cyber risk, reputation, regulation, human talent, investment performance, social change and cost reduction as areas of concern.

New Zealand ranks around the bottom quartile of countries surveyed on preparedness for changes transforming the sector, alongside nations such as Canada, the US and South Africa.

PWC says New Zealand insurers may feel less prepared to navigate the risks than the global average, but it may also be a sign that they are realistic about the challenges.

“It’s been almost 700 years since the first insurance contract was issued, yet it’s only in the past few years that insurers have faced fundamental changes in the way their industry operates,” the report says.