Principal Financial Group (PFG) KBW Insurance Conference 2025 summary

Business focus and differentiation

• Emphasis on serving small to mid-sized businesses (SMBs), especially those with under 100 employees.

• Product portfolio is broad, with bundled offerings and strong technology integration for intermediaries.

• Over-indexed in knowledge worker clients, with 55% of the block versus 40-45% industry average.

• Renewal philosophy drives cross-selling and profitability management.

• Intentional focus on knowledge-based industries for growth and persistency.

SMB market trends and sentiment

• Recent Well-Being Index survey shows SMBs are resilient, prioritizing staff retention and benefits.

• 51% of surveyed businesses added staff in the last three months, with very few reducing staff.

• SMBs are reluctant to reduce benefits, reflecting a strong labor market focus.

Disability business performance and outlook

• Disability loss ratios have improved post-pandemic due to better incidence, severity, and recoveries.

• Incidence rates expected to normalize, but improvements in severity and recoveries likely to persist.

• Plan design and knowledge worker focus contribute to lower severity and better recoveries.

• Pricing has become more competitive, with less need for renewal adjustments.

• Economic sensitivity of claims now more tied to block composition than macroeconomic trends.