Recent months have seen many discussions and questions about tax reform and its impact on the industry as a whole. The introduction of lower corporate tax rates in the U.S. has created a jubilant atmosphere, as the rates are generally expected to boost earnings and investments for many insurers. Companies including Aflac, MetLife, Travelers, and Allstate have indicated how they will use their savings.
Fred Crawford, EVP and CFO of Aflac, said the company would invest up to $250 million over the next three-to-five years in employees, philanthropic efforts and growth initiatives. “They’re going to revolve largely around digital advancement, technology advancement, in some cases, distribution, including alternative distribution,” he said. The goal, Crawford said, is to drive growth, productivity, and efficiency.
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In a press release, MetLife President and CEO Steven Kandarian said, “As a result of tax reform, we are making a significant investment in our employees. We are enhancing pay and benefit programs and helping [employees] develop skills that will make them more valuable members of our team. We are investing in their future and strengthening their long-term financial security with structural improvements that will endure. We are also channeling most of the benefits to employees at the lower end of the compensation spectrum.” This investment is meant to “accelerate a culture of learning and innovation” and help it compete in the “21st century digital workplace.”
Tom Wilson, chairman and CEO of Allstate, commented, “We are taking advantage of lower taxes to increase growth, enhance the employer value proposition, raise shareholders’ returns and improve our local communities. We are investing in growth in many of our market-facing businesses through marketing, distribution, telematics, new products, and technology.”
To learn what else is driving growth, productivity, and efficiency, download our new guide: 2018 State of the Insurance Industry.