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Suduiraut - June 11, 2004. AXA Belgium Financial Protection in Action Alfred Bouckaert, CEO AXA Belgium. Contents. 1 : Evolution of the Belgian Market 2 : AXA in Belgium 3 : Results summary 4 : Strategic priorities 5 : Conclusion.

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suduiraut june 11 2004

Suduiraut - June 11, 2004

AXA Belgium

Financial Protection in Action

Alfred Bouckaert, CEO AXA Belgium

contents
Contents
  • 1 : Evolution of the Belgian Market
  • 2 : AXA in Belgium
  • 3 : Results summary
  • 4 : Strategic priorities
  • 5 : Conclusion
high savings rate has fueled a strong growth in life and savings
High savings rate has fueled a strong growth in Life and Savings

CAGR : 9,5%

CAGR : 7,6%

CAGR : 25,6%

CAGR : 4,1%

belgian distribution landscape has changed life p c turnover
Belgian distribution landscape has changed (Life + P&C turnover)

Clients

Bank channel

35%

Brokers

37%

Tied Agents

8%

Mutual

13%

Direct

7%

Insurance GWP evolution 1994/2002 : 10.035/22.169 mio € (+121%)

Source: UPEA

the belgian insurance market has undergone considerable concentration
The Belgian insurance market has undergone considerable concentration

x 1.000.000 €

1996

2002

Top10 = 74% of the market

Top10 = 85% of the market

furthermore belgium has become a bank insurance market
Furthermore, Belgium has become a bank insurance market
  • Fortis (AG, Générale, CGER)
  • ING (BBL, La Patriotique, ING)
  • KBC (KB, ABB, CERA)
  • Dexia (Dexia, Artesia, BACOB, DVV, Corona)
  • AXA (AXA Belgium, Anhyp, IPPA, Royale Belge)

AXA = distribution through self employed brokers and bank agents

Retail banking only

contents1
Contents
  • 1 : Evolution of the Belgian Market
  • 2 : AXA in Belgium
  • 3 : Results Summary
  • 4 : Strategic Priorities
  • 5 : Conclusion
our mission financial protection

Estate

planning

Customer needs

Retirement

Risk managementFinancial Planning

Annuities

Asset management

Asset accumulation

Advice

Investments

Savings

Consumer credit

Mortgages

Credit cards

Sourced bank products

Life protection

Asset protection

Auto, home, property, liability

Life stages

Our mission: Financial Protection
axa belgium distribution channels
AXA Belgium distribution channels
  • Specialized Brokers: for large and medium-sized Companies (300)
  • General Brokers: for individuals and self-employed (12,000 - 2,700 professionals)
  • Bank agents (950)
  • La Poste
  • Viaxis : social finance
  • Partnerships : car manufacturers, banking partners, ...
a client facing organization

Corporate Clients

Individual Clients

Bank agents

Brokers

Brokers

Direct

Other channels

Car Manufact., Viaxis, ...

Product

Management

Medium / Large Businesses

Product

Management

Bank Products

Product

Management

Life & Invest

Product

Management

P& - Indiv. & Small businesses

Back Office

Bank

Back Office

Insurance- Indiv. & Small businesses

Back Office

Insurance-Corporate Lines

Support functions in synergy

A client facing organization
a new retail organization became operational on january 1 2004
A new retail organization became operational on January 1, 2004
  • Two main channels: bank agents & brokers
  • One sales management
    • broken down per product at the sales level
  • integrated at area level
    • with efforts and staff focusing on the best producer
contents2
Contents
  • 1 : Evolution of the Belgian market
  • 2 : Organisation of AXA in Belgium
  • 3 : Results Summary
  • 4 : Strategic Priorities
  • 5 : Conclusion
axa is a leader of the belgian market
AXA is a leader of the Belgian market

Market Market Share 2002 Volume 2002

  • #1 P&C 18.0% 7 873 M€
  • # 1 in Motor 20.2% 2 735 M€
  • # 2 in Property 16.4% 1 656 M€
  • # 1 in Worker comp 23.5% 1 011 M€
  • # 1 in Liability 19.4% 614 M€
  • #5 LIFE 11.8% 14 432 M€
  • # 4 Individual Life 11.5% 11 089 M€
  • # 3 Group Life 12.8% 3 342 M€
  • #2 P&C + LIFE 13.9% 22 305 M€
we have stabilized our market share in p c
We have stabilized our market share in P&C ...

Global growth of the Belgian market 2000 - 2002 : + 10,9%

Growth

Written premiums

2002 : size of the market 7 873 M€

Source: UPEA

significantly improving our combined ratio and our underlying earnings
… significantly improving our combined ratio and our underlying earnings
  • Combined ratio has improved with 10 points between 1999 and 2003.
  • Underlying earnings doubled between 2002 and 2003, to € 118 mio adjusted earnings.
in life we generated growth and improved earnings to 94 mio in 2003
In Life we generated growth and improved earnings to € 94 mio in 2003

Global growth of the Belgian market 2000 - 2002 : + 12,1%

Growth

Written premiums

2002: market size 14 432 M€

Source: UPEA

in life premiums growth is significant and outperforming traditional insurers and bank insurers
In Life, premiums growth is significant and outperforming traditional insurers and bank-insurers

Belgian market

CAGR : 16%

AXA Belgium

CAGR : 24%

expenses are being reduced
Expenses are being reduced ...

Economic expenses (in Mio €)

- 10% over 3 years

contents3
Contents
  • 1 : Evolution of the Belgian Market
  • 2 : AXA in Belgium
  • 3 : Results Summary
  • 4 : Strategic Priorities
  • 5 : Conclusion
priorities in axa belgium s strategic plan
Priorities in AXA Belgium’s Strategic Plan

Increasegrowth

Maintainprofitability

Improveefficiency

increase growth in life and savings
Increase growth in Life and Savings
  • Double the bank’s size
  • Increase loyalty
  • Develop cross-selling with bank and P&C database
maintain profitability in p c
Maintain profitability in P/C
  • Retention of existing base
  • Focus on best risks (seniors, geographical focus…)
  • Further improve claims management
  • Further streamline processes
improve efficiency
Improve efficiency
  • A continuous process
  • Further cut cost base
  • Complete systems upgrading
an integrated customer policy for growth and loyalty
An integrated customer policy for growth and loyalty

Our growth strategy is mainly based on :

  • customer loyalty
  • growth through cross-selling
significant potential of our customer base

Risk

1.473.700

Life &

Savings Bank

702.283

229.683

1.093.847

267.305

108.915

41.255

96.380

65.622

Total : 1.903.007

Credits & transactional

Bank

312.172

Significant potential of our customer base

AXA Belgium owns 50 % of Belgian households

our potential

Product groups

number of

57%

21%

10%

10%

2,6%

100%

0%

20%

40%

60%

80%

Our potential

Cross-selling rate is only 1,5 contracts.

Cross-selling rate: number of AXA products hold by household

1 product group

2 product groups

3 product groups

4 product groups

5 product groups

as you sow so you reap
As you sow, so you reap

1st step : Customer loyalty

motor wildcard november 2003

342,793 Motor Wildcard families

763,632 Total customer base Motor

Motor Wildcard (November 2003)
  • Target :
    • Bonus Malus 0 (best level) for two years by AXA
  • Goal :
    • A 30 % reduction in lapse rates

on “good risks”

  • Action :
    • The next claim is free
home wildcard march 2004

500,000 Home Wildcard

families

691,000 Total customer base Home

Home Wildcard (March 2004)
  • Target :
    • AXA customers with no claim in

the past two years

  • Goal :
    • Cut lapse rate by 20 % on

« good risks »

  • Action :
    • € 200 cash, if claim > € 1.500
mass affluent
Mass Affluent
  • Target :
    • AXA customers with more than

€ 50.000 assets under management

  • Goal :
    • Increase level of Mass Affluent

‘AUM of 5 %

  • Action :
    • Free banking account + free banking cards
    • Yearly financial check-up
    • Services & relationship advantages

65,177 Mass Affluent

(AUM > €50,000)

702,283 L & I customer base

as you sow so you reap1
As you sow, so you reap

2nd step : Cross-selling

from motor to home

342,793 Motor wildcard families

195,000 Wildcard customers do not have Home insurance

From Motor to Home
  • Target :
    • Motor Wildcard without Home
  • Goal :
    • 10 % cross-selling
  • Action :
    • 2 months free on purchasing Home

insurance

    • Home Wildcard if no claim in 2 years
slide40

500,000 Home Wildcard families

342,793 Motor Wildcard families

« Good risks » targets on which cross-selling actions will be implemented

Cross-selling targets

691,000 Home customer families

763,632 Motor customer families

65,177 Mass Affluents

(exp. > €50,000)

2 nd step: L&I customer families who over 45 years

702,283 L & I customer families

hip concept for our vip customers
HIP concept for our VIP customers

HIP

HAPPYIMPORTANTPEOPLE

Happy Drive

Happy Home

Happy You

Happy Life

Differentiation:

MA programme AUM > 50,000: products, services & relationship advantages

  • Differentiation:
  • Wildcard
  • Confidence guarantee

Differentiation:

Pension build-up & management programme

Differentiation:

Wildcard

VIP product (in co-operation with AXA Art)

contents4
Contents
  • 1 : Evolution of the Belgian Market
  • 2 : AXA in Belgium
  • 3 : Results Summary
  • 4 : Strategic Priorities
  • 5 : Conclusion
conclusion axa belgium a clear example of financial protection
Conclusion: AXA Belgium, a clear example of Financial Protection
  • A fully integrated retail model
  • Maximizes distribution reach
  • Customer-centric and not based on products as in the past
  • Allows significant economies of scale
  • Growing underlying earnings, stable market share in P/C, growth in Life and Savings
  • Brand awareness increases and is essential in what is customer driven