<p align="justify">Cigna is a multinational health services organization that operates in the managed health care industry; it is one of the United States largest health insurance providers. Cigna is based in Connecticut, USA. It is incorporated in 1982 by the merger of two health care companies. It operates through its subsidiaries and they offer products and services in medical insurance, accidental insurance, life insurance, and dental insurance. Cigna has more than 170 million customers and it provides services in more than 30 countries; it has a workforce that consists of 74,000 employees globally and it is currently ranked 65 in the Fortune 500 list (Cigna, 2020). Cigna is the major player in the insurance industry; it has recently successfully acquired Express Scripts to boost its customer base with more than 164 million (Fortune, 2020). To conduct the macro analysis of opportunities available to Cigna and current or potential threats it encounters, an analysis is conducted using the Porter five forces model.</p>
<h2 align="justify">Competitive Rivalry in the Market</h2>
<p align="justify">The United States is the biggest insurance market of the world and despite the volatile global economy insurance industry has posted underwriting gains of $5.4 billion and a combined profitable ratio of 97.3 (Friedman et al, 2019). With the high profits margins for organizations operating in the insurance industry, there is intense competition among them. Cigna has major competitors United Health Group, Anthem, and Humana. United health care added 2.4 million members in 2018 and its annual revenue was at $226,247 (Fortune, 2020). Anthem and Humana’s annual revenue for the last fiscal year were $92,105 and $56,912 respectively (Fortune, 2020). Cigna’s total annual revenue for 2019 was $153,600 million (Cigna, 2020). The insurance industry has the potential for increased profit margins and expansive business opportunities are available in the United States, therefore, there is intense competition in the insurance industry.</p>
<h2 align="justify">Threat of Substitutes</h2>
<p align="justify">The threat of substitutes is said to be high when there are better alternatives available. These services are of paramount significance as they fulfill the fundamental needs of the society and it is hard to undermine their value (McWaters et al, 2015). These services have evolved with time and with the advancement to technology the evolution is taking place at a greater pace. As innovation is taking place and mundane tasks are replaced by automated systems, innovation brings improvement in the delivery of services rather than being a substitute (Manual, 2016). In the short term, there is no real alternative available for insurance and financial advisory services, so the threat of substitutes is low.</p>
<h2 align="justify">The Threat of New Entrants</h2>
<p align="justify">The insurance industry is highly regulated; regulations are in place to protect the interest of the business and the customers. There is a stringent compliance framework to be adhered to despite the lure of higher profit margins. There is a high initial capital requirement; a significant fixed capital is required just to commence business and ensure going concern. The insurance business is highly sensitive to fraud, as fraudulent insurance claims are made to get illegitimate gains. Customers are reluctant to trust new companies and pay a significant premium as trust is an important factor in customer determining an insurance provider. Considering the capital and compliance requirements along with exposure to fraud deters new entrants; therefore, the threat of new entrants is low.</p>
<h2 align="justify">Bargaining Power of Buyers</h2>
<p align="justify">Financial advisory services and the insurance industry are highly competitive. As explained above United States insurance industry is highly competitive due to the presence of multiple insurance providers. The basic services offered in the financial services sector are similar, with no or slight differentiation in services and their price (Vyas &; Raitani, 2014). The buyer is aware of all the products offered by a given company in the industry and the buyer can decide to choose one from many available options. They can negotiate the optimal services at the best-suited price for them, given that buyers have high bargaining power.</p>
<h2 align="justify">Bargaining Power of Supplier</h2>
<p align="justify">In the financial services sector; the insurance industry is the premium based business. There are two primary sources of supply for the insurance company, one is the premium and the second is the expert human resources. The premium received by the company is dependent on the service offered in return. According to (Friedman et al, 2019) insurance premiums are expected to grow in 2020. With the growth in premiums and an increase in the number of customers, the supply from premiums will be sufficient. On the contrary, domain experts are hard to come by especially in the insurance industry, as to be a qualified profession one has to undertake a college degree and ace tough professional exams that can take up to 10 years in total. By taking into account both of these factors the bargaining power of suppliers is moderate.</p>
<h2 align="justify">References</h2>
<p align="justify">Cigna. (2020). About-us. Company profile. Available at: https://www.cigna.com/about-us/company-profile/<br />
Cigna. (2020). Cigna Newsroom. Available at: https://www.cigna.com/newsroom/news-releases/2020/cigna-delivers-strong-2019-results-expects-continued-attractive-revenue-and-earnings-growth-in-2020<br />
Fortune. (2020). Global 500. Available at: https://fortune.com/fortune500/2019/unitedhealth-group/<br />
Fortune. (2020). Global 500. Available at: https://fortune.com/fortune500/2019/anthem/<br />
Fortune. (2020). Global 500. Available at: https://fortune.com/fortune500/2019/humana/<br />
Friedman,S., Canaan, M., Gokhale,N., Ashani,P. (2019). 2020 insurance outlook<br />
Insurers adapt to grow in a volatile economy. Available at:https://www2.deloitte.com/us/en/insights/industry/financial-services/financial-services-industry-outlooks/insurance-industry-outlook.html</p>
<p align="justify">Manual, E.G. (2016). The five competitive forces of the insurance and pension funds industry for the Angolan case.<br />
McWaters, J., Bruno, G., Lee, A., &; Blake, M. (2015). The Future of Financial Services-How disruptive innovations is reshaping the way financial services are structured, provisioned and consumed. In the World Economic Forum. Junio de (Vol. 2105).</p>
<p align="justify">Vyas, V. and Raitani, S. (2014). Drivers of customers’ switching behavior in Indian banking industry. International Journal of Bank Marketing Vol. 32 No. 4, 2014 pp. 321-34.</p>