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The future of distribution strategies. Bart De Smet, CEO Ageas Insurance Strategy Europe Brussels, 22 March 2012. Agenda. 1. Insurance distribution in Europe 2. Distribution at Ageas group 3. Ageas Belgium 4. Ageas UK 5. Ageas Malaysia 6. Conclusions.

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the future of distribution strategies

The future ofdistribution strategies

Bart De Smet, CEO Ageas

Insurance Strategy Europe

Brussels, 22 March 2012

agenda
Agenda

1. Insurance distribution in Europe

2. Distribution at Ageas group

3. Ageas Belgium

4. Ageas UK

5. Ageas Malaysia

6. Conclusions

Insurance Strategy Europe 2012 | 22 March 2012

slide3
European insurers use a wide range of methods to sell insurance products.
  • The importance of each distribution channel varies per country, caused by different factors
  • There is also a clear difference between Life and Non-life insurance

Insurance Strategy Europe 2012 | 22 March 2012

in europe the bancassurance channel is dominant in life

indicates Ageas presence

In Europe, the bancassurance channel is dominant in life …

Source: CEA statistics

Insurance Strategy Europe 2012 | 22 March 2012

while brokers and agents are dominating non life

indicates Ageas presence

… while brokers and agents are dominating non-life

Source: CEA statistics

Insurance Strategy Europe 2012 | 22 March 2012

each channel has specific strengths
Each channel has specific strengths

High

Low

Broker

Bank

Internet

Agents

Affinity

  • Service / advice driven
  • Product complexity
  • Price sensitivity
  • Speed
  • Brand importance
  • Insurer controls branding / message

Agents

Affinity

Bank

Internet

Broker

Internet

Bank

Agents

Affinity

Broker

Internet

Bank

Agents

Affinity

Broker

Internet

Affinity

Agents

Bank

Broker

Internet

Agents

Bank

Affinity

Broker

Insurance Strategy Europe 2012 | 22 March 2012

control is shifting to the customer
Control is shifting to the customer

Traditionally, the insurer has been in control of the value chain….

Customer

Intermediary

Insurer

Reinsurer

… where insurers dictated everything and the customer is not in the driving seat

…and now the value chain is reversing to leave the customer in control

Customer

Intermediary

Insurer

Reinsurer

Customers are now more informed and demanding so that insurers and intermediaries have to be more responsive to the needs and norms demanded by the customer

Insurance Strategy Europe 2012 | 22 March 2012

drivers of change in the distribution mix
Drivers of change in the distribution mix
  • Decreasing fiscal stimuli and increased transparency
  • Banks’ focus on liquidity
  • Internet and social media low-cost alternatives for standard products
  • Success of aggregators in UK could spread to other markets
  • Regulation and technology cause a consolidation among brokers
  • Opportunities for affinities with strong brands

Insurance Strategy Europe 2012 | 22 March 2012

a multi channel strategy is needed to service today s customer
A multi-channel strategy is needed to service today’s customer
  • Customer loyalty is low
  • Customers are better informed
  • Customers are more demanding
  • Customers use a greater variety of channels for different purposes
  • Technology supports changing attitude
  • ‘Hybrid’ customers

Insurers must deploy a multichannel strategy to serve their customers at the time, at the place and through the channel that the customers prefers

Source: Accenture Multi-channel Survey 2010

Insurance Strategy Europe 2012 | 22 March 2012

agenda1
Agenda

1. Insurance distribution in Europe

2. Distribution at Ageas group

3. Ageas Belgium

4. Ageas UK

5. Ageas Malaysia

6. Conclusions

Insurance Strategy Europe 2012 | 22 March 2012

ageas is active in europe and asia where it co operates with many different distribution partners
Ageas is active in Europe and Asia, where it co-operates with many different distribution partners

China

Belgium

Belgium

United Kingdom

UK

Luxembourg

France

Malaysia

Turkey

Portugal

Italy

Malaysia

India

Italy

Thailand

Insurance Strategy Europe 2012 | 22 March 2012

a broad based distribution capacity at group level
A broad based distribution capacity at group level …

Other

13%

Affinity

1%

Agents

12%

Brokers

19%

Bancassurance

55%

As % of GWP 2010, Including non-consolidated joint ventures at 100%

Insurance Strategy Europe 2012 | 22 March 2012

slide13

… but also within the different segments

Belgium

Continental Europe

(20%) Employee Benefits

(8%) Partners (8%) Agents

(34%)

Brokers

(32%)

Broker

(48%) Bank

(50%) Direct

Asia

  • Portugal: bank (Millenium BCP)
  • Italy: bank (Ubibanca)
  • Luxembourg: bank (BGL), brokers, employee benefits
  • France: brokers
  • Turkey: bank (Akbank), agents, brokers
  • Malaysia: bank (Maybank), agents, brokers, affinities
  • Thailand: bank (Kasikornbank), agents, brokers, affinities, direct marketing
  • China: bank (several Chinese banks), agents, brokers
  • Hong Kong: agents, IFA’s
  • India: bank (IDBI and Federal Bank), agents

UK

Insurance Strategy Europe 2012 | 22 March 2012

agenda2
Agenda

1. Insurance distribution in Europe

2. Distribution at Ageas group

3. Ageas Belgium

4. Ageas UK

5. Ageas Malaysia

6. Conclusions

Insurance Strategy Europe 2012 | 22 March 2012

integrated multi channel insurance company
Integrated multi-channel insurance company
  • Bancassurance: 1,000 branches of BNP Paribas Fortis Bank and Belgian Post bank branches
  • Assurfinance: 316 Fintro agents
  • Brokers: 3000 independent brokers
  • Pensions: Consultants, International Networks and B2B

Insurance Strategy Europe 2012 | 22 March 2012

broad distribution reach
Broad distribution reach

Ageas in Belgium

Rest of market

Life

Non-Life

Total

Insurance Strategy Europe 2012 | 22 March 2012

slide17

Multi-Channel Strategy is reflected in the organisation model

  • Channel specific organisation with cross sharing of product development skills and support entities

Broker

Channel

Employee

Benefits

& Health Care

Channel

Bank

Channel

Life

Non-Life

Life

Non-Life

Health

Care

Group

Life

Life product development

Non-life product development

Individual Health Care product development

SUPPORT

Business Operating Office (IT, Facility Management, Financial Relations, Central Purchase Office, BOO Support), CFO, Asset Management, HR, Risk & Compliance, Audit, Performance Management

Insurance Strategy Europe 2012 | 22 March 2012

product innovation belgium the award winning modulis vip model synergy
Product Innovation – BelgiumThe award-winning* Modulis VIP Model synergy

Banking clients

Insurance relationships

Other Insurers

through Broker

AG Insurance

through Broker

130,000

BNP Paribas

Fortis400,000

Other

Banks

Other

Channels

800,000

800,000

Insurance Strategy Europe 2012 | 22 March 2012

agenda3
Agenda

1. Insurance distribution in Europe

2. Distribution at Ageas group

3. Ageas Belgium

4. Ageas UK

5. Ageas Malaysia

6. Conclusions

Insurance Strategy Europe 2012 | 22 March 2012

slide20
General Insurance distribution in the UKPersonal and Commercial lines have very different distribution mixes

Source: ABI

Insurance Strategy Europe 2012 | 22 March 2012

ageas uk distribution profile
Ageas UK distribution profile

GWP £m

Source: Ageas UK

Insurance Strategy Europe 2012 | 22 March 2012

ageas has invested heavily in distribution and partnerships
Ageas has invested heavily in distribution and partnerships
  • Access to our products and services through whatever channel
  • Investment in distribution
    • Investment in partnerships

Insurance Strategy Europe 2012 | 22 March 2012

agenda4
Agenda

1. Insurance distribution in Europe

2. Distribution at Ageas group

3. Ageas Belgium

4. Ageas UK

5. Ageas Malaysia

6. Conclusions

Insurance Strategy Europe 2012 | 22 March 2012

etiqa
Etiqa
  • Etiqa launched in November 2007
  • Owned by Maybank (69.05%) and Ageas (30.95%)
  • All types of Life and General insurance and Takaful plans
  • Multi-distribution: Bancassurance, Agents, Brokers and Direct Distribution
  • One of the pioneers for direct sales through internet: Online Motor Takaful

Insurance Strategy Europe 2012 | 22 March 2012

slide25

Etiqa – multi product, multi-distribution

Channel Mix 2011

Product Mix 2011

Insurance Strategy Europe 2012 | 22 March 2012

slide26

Complete Product Offerings at all Life Stages

BANCASSURANCE

CALL CENTRE

AGENCY

Married

Young & Single

Young & Single

Product diversification

Married with

Young Children

Retired

Married with

Grown-up Children

BRANCHES

ALTERNATIVE DISTRIBUTIONS

ENTERPRISE – Employees' Benefits

Insurance Strategy Europe 2012 | 22 March 2012

slide27

Etiqa is a frontrunner in using new media

MotorTakaful.com

  • Newly launched campaign, themed “Celebrating Malaysian Drivers”, is a fun and casual approach in engaging the customers
  • 10% off over and above normal No Claims Discount when purchasing online
  • Access to free, 24 hour Auto Assist program
  • Can check motor claim status online

Etiqa Fan Page

  • The award winning, Etiqa Fan Page on Facebook is informative with the latest news and update on the events and promotions
  • Alternative channel for the customers to get in touch with Etiqa and brings Etiqa closer to people’s heart

Etiqa Oneline

  • Fast, easy and simple with just one phone
  • Open weekdays and Saturdays
  • Access to information regarding Etiqa's products and services such as making changes to their policies or certificates

Insurance Strategy Europe 2012 | 22 March 2012

agenda5
Agenda

1. Insurance distribution in Europe

2. Distribution at Ageas group

3. Ageas Belgium

4. Ageas UK

5. Ageas Malaysia

6. Conclusions

Insurance Strategy Europe 2012 | 22 March 2012

conclusions
Conclusions
  • The distribution landscape is changing due to technologic, regulatory, demographic and economic changes
  • Customers become more demanding and less loyal
  • Insurers must deploy a multichannel strategy to service their customers at the time, at the place and through channel that the customers chooses
  • Over time, these channels will be increasingly integrated to service the volatile, informed customer of the future
  • At Ageas, we are actively working on a multi-distribution strategy, tailored to the markets we are active in
  • This requires time, resources and capital, but it is necessary to survive in these testing times

Insurance Strategy Europe 2012 | 22 March 2012