Investor Day 2009 - Regional business presentation Belgium

50 %
50 %
Information about Investor Day 2009 - Regional business presentation Belgium
Investor Relations

Published on March 6, 2014

Author: Ageas

Source: slideshare.net

Description

Presentation about AG Insurance

AG Insurance

Agenda 1. Profile and track record 2. The market and the competition 3. Strategic initiatives 4. Conclusion FORTIS I 9/25/2009 I page 2

Profile AG Insurance Key financial data Mission/strategy FY 08 Gross inflow (EUR bn) Life Non-Life Operating costs (EUR mio) Net profit (EUR mio) Life Non-Life Combined ratio (%) APE (EUR mio) EV (EUR bn) VANB (EUR mio) 6.3 4.8 1.5 (405) 6 (85) 91 100.9 419 3.8 53 H1 09 3.5 2.7 0.8 (209) 204 181 23 105.6 223 n.a. n.a. Key competences  Market leader in Belgium, with total market share of 22.3% in FY 08 N 1 in Life: 26.3% N 2 in Non-Life: 14.8%  Integrated multi-channel operating model (Brokers, Bancassurance and Assurfinance)  Full product range, covering the needs of all market segments  Customer and channel centric organisation The mission of AG Insurance is:  To be the leading and most profitable multi-distribution service provider of insurance products  To strengthen our market leadership position in our three main market segments: Life, Group Life, and Non-Life By focusing on the following strategic levers:  Multi-channel distribution  Product innovation  Operational excellence Product and distribution mix FY 08 Inflow: 100% = EUR 6.3 bn (24%) Non-Life (76%) Life * Before minority interest of 10 EUR mio to Fortis Bank FORTIS I 9/25/2009 I page 3 (19%) Employee Benefits (33%) Broker (48%) Bank

Key figures 06-09 FY 06 Gross inflow (EUR mio) Life Non-Life Operating costs (EUR mio) Net profit (EUR mio) Life Non-Life Incidentals*: Impact market turmoil DRD tax benefit Combined ratio (%) FUM Life (EUR bn) APE (EUR mio) EV (EUR mio) VANB ** (EUR mio) Total solvency (EUR mio)  FY 07 FY 08 H1 09 6,744 5,475 1,269 (378) 553 434 119 7,518 6,151 1,367 (389) 522 425 97 6,283 4,818 1,465 (405) 6 (85) 91 3,554 2,746 808 (209) 204 * 181 23 0 (89) (534) 99.1% 38.2 511 4,832 189 *** n.a. 100.4% 42.1 585 5,307 151**** 3,682 (82) 94 100.9% 105.6% 41.8 43.4 419 223 3,817 n.a. 53 ***** n.a. 3,536 3,732  Stable underlying earnings over the past years  Commercial momentum maintained * Before minority interest to BNP Paribas Fortis Bank. On 12 May ‘09 Fortis sold 25% + 1 share of AG Insurance to Fortis Bank, resulting in a minority interest of EUR 10 mio for the first half of FY 09 ** VANB : As of FY 08, VANB is calculated after Result-Related Commission (RRC), therefore, comparable figures on 3 years are not available *** EUR 189 mio before RRC **** EUR 209 mio before RRC – EUR 151 mio after RRC ***** EUR 53 mio after RRC FORTIS I 9/25/2009 I page 4

Combined ratio Relation between Combined Ratio and Return on Required Capital (EUR mio) Property Motor ThirdParty Liability Workmen’s Comp Premiums earned 100 100 100 726 Required Capital 32 32 47 468** Reserve /premium 40% 190% 550% 175% Investment income 2.9 8.9 23.9 68 Technical result excl fin income 3.0 (3.0) 15.4 (40) 97.0% 103.0% 115.4% 105.5% 3.9 3.9 5.6 22.8 12.0% 12.0% 12.0% 9.7% Combined ratio Net Profit Return on Required Capital  Target is to have a positive underwriting result, but …   … high reserve to premium ratio, driven by product mix, allows to have combined ratios of more than 100% while still having adequate returns * Based on H1 09 results ** Based on annualized H1 2009 premiums FORTIS I 9/25/2009 I page 5 TOTAL Non-Life*

Agenda 1. Profile and track record 2. The market and the competition 3. Strategic initiatives 4. Conclusion FORTIS I 9/25/2009 I page 6

Leading market position in Belgium remains intact Life Inflow per distribution channel (EUR mio) Individual Life FY 07 market shares (based on FY 08 Assuralia publication*) Non-Life (22%) Others (28%) AG Insurance Workmen’s Comp 1,971 Group Life 117 (12%) Dexia Health Care 1,630 (14%) AXA -incl. Winterthur 116 (11%) KBC 1,206 (13% Ethias 60 Non-Life 1,854 FY 07 market shares (based on FY 08 Assuralia publication*) 929 495 1,514 522 (22%) AXA -incl. Winterthur 59 633 654 102 110 531 544 (33%) Others 651 348 (16%) AG Insurance (6%) P&V (9%) KBC H1 08 H1 09 (14%) Ethias H1 08 H1 09 H1 08 H1 09 Bank Broker Employee Benefits * FY 07 are latest available market shares published in Assuralia newsletter Assurinfo nr 34 -16 October ‘08 FORTIS I 9/25/2009 I page 7

AG Insurance has a major foothold in dominant distribution channels Market shares of AG Insurance’s three main channels (Broker, Bancassurance, Assurfinance) are not under pressure Brokers Assurfinance Life market 100% Agents Direct* Non-Life market 100% Bancassurance 20 22 80% 4 80% 13 60% 14 43 13 20 13 3 1 10 6 4 60% 6 40% 40% 70 20% 60 13 45 20% 21 FY 07 FY 06 FY 05 FY 04 FY 03 FY 01  Non-Life: market share of Brokers, Banks and Assurfinance 70% in FY 07, down 4% vs FY 95 * Direct includes B2B, B2C, E-commerce, other direct (affinity groups, captives & pools) but also mutuals and cooperatives FORTIS I 9/25/2009 I page 8 FY 01 FY 00 FY 99 FY 98 FY 97 FY 96 FY 95 FY 07 FY 06 FY 05 FY 04 FY 03 FY 01 FY 01 FY 00 FY 99 FY 98 FY 97 FY 96 FY 95 FY 94  Life: market share of Brokers, Banks & Assurfinance 77% in FY 07, up 12% vs FY 95 FY 94 0% 0%

Competition   Increasingly vigilant regulators with focus on governance, compliance and transparency  Faster pace of regulatory change, especially in customer protection and transparency  Solvency 2 & IFRS phase 2 leading to a convergence of regulatory and economic capital  Unstable tax environment  Customers becoming more knowledgeable, price conscious, looking for convenience and transparency  Ageing population and wealth shift  Increasing Corporate Social Responsibility (CSR) awareness     FORTIS I 9/25/2009 I page 9  Bundling of products/solutions  Shift from 0-% guarantee to savings products with guaranteed interest rate  Shift to unit-linked products with capital guarantee  Entry of retirement solutions (annuities)  Competition with focus on price, new market formulas and distribution approaches  Aggressive niche players attacking specific segments  War for talent and specific profiles

Agenda 1. Profile and track record 2. The market and the competition 3. Strategic initiatives 4. Conclusion FORTIS I 9/25/2009 I page 10

Key strategic objectives Non-Life   Return to higher profitability (target combined ratio below 100% over next years) while keeping portfolio stable through Tariff increases where required Reduction of cost ratio Adjust product features when needed  Re-entering market of medium sized companies Retail Life   Simplification of Unit-Linked offer  Move to one IST platform in individual life  Promote products that are not in direct competition with banking products (“backwaters”, such as risk, disability, and traditional products) Group Life   Further reinforce the embedded customer intimacy strategy  Focus on segment below Top 300 companies, currently not being well served  Operational excellence with new IST platforms FORTIS I 9/25/2009 I page 11

Key Strategic Objectives Multi-channel Distribution   Enhance cross-selling strategy and exploit untapped distribution synergies  Successfully implement Modulis VIP and ‘Back-to-the-front’ Modulis VIP, exploiting distribution synergies between bank and broker channel Enhance cross-selling Group Life with Fortis Bank Back-to-the-front: sales support staff and insurance experts to further increase insurance sales in the Bank channel Product-market innovation   Be recognized as the product champion in the industry  Continue high pace of innovation Strengthen Non-Life offering for Retail & SME market Pack-strategy: offer extended solutions to specific client segments Pension@work: Group Life offer for SME market Operational excellence   Continue to be among the most cost efficient multi-channel insurer, while providing best-in-class services to clients and distributors Non-Life platform integration has been finalized Reengineering of Group Life and Individual Life platforms FORTIS I 9/25/2009 I page 12

Non-Life Strategy - Focus on the strengths of both distribution channels and make them work in synergy  Retail market approach  Business market approach  Both channels (Bank & Broker) with limited cannibalisation  Broker channel only (often deep technical knowledge required)  With one common product set (same products, same acceptation & tarification rules; bank branches can sell these products at the best price a topbroker can get)  Specific products (more „tailor made“)  On one IT system (costs synergy)  A new synergetic model: Modulis VIP FORTIS I 9/25/2009 I page 13

Non-Life Strategy - The Modulis VIP Model synergy Banking Clients BNP Paribas Fortis 400,000 Insurance Relationships Modulis VIP strategy will …  Push the business client to insure his risks with AG Insurance, respecting his current broker relation (if any)  Stimulate the client of the broker to choose BNP Paribas Fortis as banking partner AG Insurance Through Broker 130,000 Other Cies Through Broker Other Banks Other Channels 800,000 FORTIS I 9/25/2009 I page 14 800,000   Cut the current insurance relationship with the competition (Ethias, KBC, etc.) that might endanger the banking relationship  Propose to these clients without broker the services of a broker  Bank receives lead remuneration plus 2% portfolio commission  Modulis VIP client enjoys higher no-claim bonus

Modulis VIP: First Results SITUATION 27/06/’09 Commercial achievements      Contribution in new business and portfolio >16,000 leads received by end June ‘09 >6,400 Modulis VIP files in portfolio One offer in 2 is converted into a contract Practically all 1,000 BNP Paribas Fortis branches involved >2,500 brokers involved (max. 4,000 professional active brokers)  After 16 months, Modulis VIP represents: 8% of the Modulis portfolio 3.6% of the SME portfolio  New Modulis VIP = 20% of the new Modulis files Number of leads Modulis VIP Conversion of Leads Modulis VIP 1,500 29% 40% conversion 1,000 18% 22% 500 31% 4,616 4,885 2,928 3,469 3 4 5 6 7 8 9 10 11 12 1 FY 08 FORTIS I 9/25/2009 I page 15 2 3 4 5 FY 09 6 Existing Modulis files New Leads/Offers Leads/Offers Modulis files in progress not converted

Agenda 1. Profile and track record 2. The market and the competition 3. Strategic initiatives 4. Conclusion FORTIS I 9/25/2009 I page 16

Conclusion  Stable underlying profitability, in a difficult market context, with commercial momentum holding well  Maintain leadership position in Life  Return to higher profitability (target combined ratio <100%) in Non-Life  Still room for further growth through crossselling and product and service innovation FORTIS I 9/25/2009 I page 17

Add a comment

Related presentations

Related pages

BNP Paribas Fortis Industrial Plan

Corporate and Public Bank Belgium 43| 01.12.09 | Presentation Overview 1. ... China, Gulf region ... Closing Investor Day May 12 2008 2009 2012.
Read more

Presentations - Sappi North America | Home

SA Investor Day presentation ... 11 November 2009 Presentation ... Global business strategy; Investors contacts;
Read more

VINCI Energies - Analyst & Investor Day

10 Pôle Energies VINCI Energies France 2010 revenue: €3 bn Workforce: 19,500 VINCI Energies & Cegelec International 2010 revenue: €2.2 bn
Read more

YIT Capital Markets Day 2009 - Building and Construction ...

YIT held Capital Markets Day for analysts and investors on ... YIT presented the Group's strategy and business ... 2009. The day ended with site ...
Read more

Investor presentations – 2010 – ArcelorMittal

Investor presentations from ArcelorMittal’s investor days, ... Investor Day in London and New York The Future of Our Business Lakshmi Mittal:
Read more

Presentations - Investor Relations - Enel.com

Enel Investor Day. investor_day_on ... December 11 2009. Educational Investor Day: Latam. November 04 2009. 9M2009 Results. ... Investor Day Presentation ...
Read more

Annual Report - Investor Relations | Allianz

Business Insurance Large ... Annual Reports 2009. Annual Report Allianz Group (PDF, 5.0 MB) ... Allianz Investor Relations App.
Read more

Presentations - Investor Centre - Company Information ...

Regional Gotta Go Fares; ... Investor Centre. Annual Meeting; ... 2010 Interim Results Presentation. Investor Day October 2009.
Read more

Investor Presentations | JPMorgan Chase & Co.

Investor presentations ... Principles Guiding our Business INSTITUTE . About ... JPMorgan Chase 2015 Investor Day . Webcast:
Read more

Private Banking - Credit Suisse Investor Day

Credit Suisse Investor Day 2007 Zurich ... This presentation contains forward-looking statements within the ... Established regional entrepreneur and ...
Read more