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Eurapco – European Alliance Partners Company Avoiding Conflicts and Dissatisfaction between Multichannel and Sales Jacob Flemming 17.09.2009 / Vienna.

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Presentation on theme: "Eurapco – European Alliance Partners Company Avoiding Conflicts and Dissatisfaction between Multichannel and Sales Jacob Flemming 17.09.2009 / Vienna."— Presentation transcript:

1 Eurapco – European Alliance Partners Company Avoiding Conflicts and Dissatisfaction between Multichannel and Sales Jacob Flemming / Vienna Eurapco - Creating value together

2 Index Eurapco Multichannel concept & Business value proposition
In each Market / Partner Best Practice: How to avoid conflicts? Understanding management requirements in every channel Increasing productivity without spoiling remuneration systems Eurapco - Creating value together

3 Partners Eurapco - Creating value together

4 Partners Eurapco - Creating value together

5 TOTAL Business 2008 (million Euros)
Eurapco - Creating value together

6 Non life Business 2008 Premium income (million Euros)
TOTAL 31’412 Eurapco - Creating value together

7 Life Business 2008 Premium income (million Euros) and market positioning TOTAL 11’949 13 n.a. 4 12 9 5 4 Note that the figures mentioned are not directly comparable between Partners as their accounting rules and requirements differ. Eurapco - Creating value together

8 Multichannel concept Factory Clients Channel UW Policy adm. Post sales
Accounting Investments IT Clients Individual Groups Corporations Channel Agents Direct Banks Corporate agreements Brokers Eurapco - Creating value together

9 Business Value proposition and model
Traditional Ag & Bks Bancassurance Direct Marketing Case oriented Segment oriented Cherry pickers Product Wide product range Permanent adaptation to individual consumers needs Few – simple and wide products linked or not to financial products Easy to modify Few, simple & wide Easiest modifiable product IT Very complex processes Processes must be adapted to the Bank Fixed – streamlined Claims Involvement desire No involvement Training In depth - wide Basic In depth - standar Controls & Mgm. Info. High & costly controls - UW, Claims & Financial Mgm. Info. Vital & volatile seldom shared Easy, transparent & shared control UW, Claims & Financial Mgm. Info. Vital, shared and more meaningful Easy, permanent control Mgm. Info to aloud permanent fine tuning Eurapco - Creating value together

10 Business Value proposition and model
Traditional Ag & Bks Bancassurance Direct Service levels Segmented Agents – intranets Brokers – Access to UW / Claims Segment oriented Cherry pickers Product Wide product range Permanent adaptation to individual consumers needs Few – simple and wide products linked or not to financial products Easy to modify Few, simple & wide Easiest modifiable product IT Very complex processes Processes must be adapted to the Bank Fixed – streamlined Claims Involvement desire No involvement Training In depth - wide Basic In depth - standard Controls & Mgm. Info. High & costly controls - UW, Claims & Financial Mgm. Info. Vital & volatile seldom shared Easy, transparent & shared control UW, Claims & Financial Mgm. Info. Vital, shared and more meaningful Easy, permanent control Mgm. Info to aloud permanent fine tuning Eurapco - Creating value together

11 Preliminary considerations
Channels in different Markets can have different weight and development Multichannel to diversify from main channel Protect main channel or not ? Use the strength of the brand or create a new brand ? Price and Service Levels by channels ( personal lines ) Not subsidize Different loss ratios by channels Certain channels are still marginal but we think have high growth potential Eurapco - Creating value together

12 Multichannel = Channels conflicts ?
ALLIANZ TO CLOSE ALLIANZ 24 Allianz is to close its direct internet operation Allianz 24, moving the system to the Allianz web site, reports Insurance Day. Allianz was said to be planning a new presence in the discount insurance market via another yet-to-be-launched online platform that will not use the Allianz brand name. The new platform will be pan-European. BRAND ISSUE Allianz launched Allianz 24 in 2005, attempting to sell traditional policies via agents MAIN CHANNEL and cut-price policies via the internet. Allianz conceded this week that it was a “classic case of the collision between two different sales channels”. Allianz 24 caused resentment amongst the insurer’s 10,000 agents because customers could buy the same policies for up to 30% less but then, having bought the policies online, demanded the same after-sales service from agents. PRICE AND SERVICE Allianz 24 insured only about 300,000 vehicles online last year, out of nearly 9m vehicles in total. MARGINAL IMPACT Eurapco - Creating value together

13 France – Covéa (2008) Covéa Channel distribution MARKET
French Market shrinks by 6% in 2008 ( Life -10.3%, Non life +4% ) Life: 62% Bancassurance - Non life: 38% Direct, 35% Tied Agents COVÉA Stable GWP in 2008 6% Market Share. Rank #8 overall, #1 in Motor, #1 in Property & Liability Eurapco - Creating value together

14 Distribution Strategies
Covéa Distribution Strategies Covéa : Group Partnership structure. Composed of 3 independent Insurance Companies: MAAF: Direct insurer, 574 points of sales MMA: Tied agents, 1971 points of sales + Broker Business (Covéa Risks) GMF: Direct insurer, 400 points of sales Besides: Covéa Fleet: Fleet business through Maaf, MMA, GMF and brokers Eurapco - Creating value together

15 Multichannel strategy
Covéa Multichannel strategy Covéa as such does not really have a strategy on this topic: these strategies are up to each Company. Therefore, the 3 brands are competing against each other at a sales level MAAF: business done by Maaf employees in Maaf shops; MMA: business is done by tied agents in MMA Agencies; GMF: business is done by GMF employees in GMF shops MAAF, MMA and GMF propose online insurance: brand, prices are the same as in the shops. No internal competition, unlike some other companies (Groupama and their low-cost amaguiz.com) Nexx: a MAAF daughter company (Online / Phone). Used for White Labelling and to have a different pricing policy without competing against the main distribution channel. MMA/Covéa Risks: identical U/W guidelines and Terms & Conditions to avoid internal competition Eurapco - Creating value together

16 Description Sales Channel
EUREKO Description Sales Channel Eurapco - Creating value together Source: Company Data 2007/2008 figures not available

17 EUREKO Brand Distribution channel Characteristics Direct Agents
Brokers Bank Leading multi-channel insurer in The Netherlands Innovative service propositions Strong portfolio of brands Leading insurance company in Greece Superior agent management; best recognized brand Leading broker channel co-operation in Ireland Highly successful and well respected multi-specialist financial services company. Distribution Strengths Leading insurance company in Poland Strong and loyal distribution network Very strong brand (99% brand awareness) Red is where we are Light blue is where we will develop. Interamerican: Bancassurance opportunity with Eurobank? Bancassurance opportunity with Novabank? Direct approach through a JV with Dimitri Contominas? Friends First: is going to expand its range of distribution channels. Imperio France: Very successful penetration through BCP’s network; agents channel needs revival. Medium sized Life and Non-Life insurer Niche market player,single distribution Strong bancassurance as result of BCP relation Developing operations in Romania, Bulgaria and Cyprus Eurapco - Creating value together

18 Distribution channels The Netherlands - ACHMEA
EUREKO Occupational Health Direct Banking Product channels Distribution channels Pensions Health The Netherlands - ACHMEA Broker Property & Casualty When there is a channel conflict product and price are the same, but the marketing strategy will be different. We strive for market leadership in all segment and for a leading position in all distribution channels, direct, broker, bank distribution (currently #1 in direct and bank distribution and # 5 in broker distribution) Key to our Dutch strategy are operational excellence and cost leadership Eurapco - Creating value together

19 GERMANY – GOTHAER / Description
Channel distribution GERMANY – GOTHAER / Description MARKET 1,5% German market growth in 2.008 ( Life 1,8% - Non life 1% ) Life 75% Agents and Brokers Non life 89% ( Agents 45% Brokers 44% ) GOTHAER 2,3% Growth ( Life 3% - Non life 1,7% ) Market quota 2,2% number 12 in the ranking GWP Eurapco - Creating value together

20 Multichannel strategy
GOTHAER Multichannel strategy Main channel: traditional ones (Agents and Brokers) Complementary channels: companies Juanitos (white label) and Asstel (direct business) Different branding by channels besides traditional which are under the original Company/Brand. Price differs from one channel to the others, according to different cost structures Service levels the same in all channels Economic impact: Volume very small, just start up companies Eurapco - Creating value together

21 Market shares non-life per regional insurance company
Länsförsäkringar Market shares non-life per regional insurance company 31,4 75% of the Swedish population lives outside Stockholm 43,0 52,2 41,6 31,3 40,0 57,9 16,7 38,9 36,8 41,5 45,9 38,5 55,6 27,7 50,2 50,9 35,8 44,5 49,1 41,5 36,7 30,1 43,7 Eurapco - Creating value together

22 Länsförsäkringar Distribution of Life, Non-Life and Bank products Commercial Lines Private Lines Salaried staff 35% Captive agents 10% Brokers 65% Increased sales through brokers and captive agents Telephone 60% Agents (captive and car dealers) 20% Internet 15% Direct mail / Affinity Groups 5% Increased sales through the Internet channel Eurapco - Creating value together

23 Channel Strategy Länsförsäkringar
No channel conflicts on the personal lines Brand Name endorsing each region, e.g. Länsförsäkringar Göteborg Same price for all channels, services depends on channel Eurapco - Creating value together

24 Länsförsäkringar Potential for increased customer commitment in LF Large customer base – few full-service customers 487,000 Life & Non-life LIFE 418,000 BANK 161,000 167,000 Life, Non-life & Bank 170,000 Non-life & Bank 48,000 Life & Bank NON-LIFE 1,824,000 Total: Approx. 3.3 million customers Länsförsäkringar in the market Eurapco - Creating value together

25 SPAIN – CASER CASER Channel distribution MARKET
7,6% Spanish market growth in 2.008 ( Life 15,2% - Non life 2% ) Life 72% Bancassurance - Non life 66,9% ( Agents 38,6 Brokers 28,3 ) CASER 11,6% Growth ( Life 30,4% - Non life -0,8% ) Market quota 4% number 5 in the ranking GWP Eurapco - Creating value together

26 Multichannel strategy
CASER Multichannel strategy Main channel Bancassurance / Shareholders No different branding by channels Coming from “White brand” in Bancassurance and Affinities Price restriction diversification channels higher than highest in Bancassurance Service levels the same in all channels Economic impact: Volume smaller than 22% but 40% in Non life Results below average No cross subsidising Eurapco - Creating value together

27 Swiss Mobiliar Channel-Split 2007 in Non-Life (Portfolio) Swiss Market
10 % Swiss Mobiliar Total Market (CHF Mrd.): 15.9 Channel-Split 2007 in Non-Life (Portfolio) Swiss Market 70 % 25 % 3 % 2 % Mobiliar 87 % 12 % 1 % 0 % Call-Centre Internet Brokers Agents Eurapco - Creating value together

28 Business Model Swiss Mobiliar Today Tomorrow Some local Brokers
Local Referal Partners Call Center (Mobi24) (Assistance only) Internet (Information only) Agencies Call Center (Mobi24) Internet Some local Brokers Local Referal Partners Agencies Using more channels, but all business canalised through local general agencies. Commercial business possible also through brokers Eurapco - Creating value together

29 Swiss Mobiliar 5 Main Drivers for Successful Implementation of integrated Multi Channel Business Model consumer-friendly internet-products with optimized „bridges“ to agent channel „protection" of portfolios and customers in multi-channel environment identical price for identical coverage in all sales channels diese Punkte sind bereits bekannt aus den Ausführungen von U.Berger im GA Dialog Verfügbarkeit / Durchgängigkeit Kundendaten: Vertriebsplattform bringt uns hier entscheidend weiter; z.T. aber erst in RE 2 Portefeuilleschutz: als Grundsatz gilt das Gebietsprinzip ergänzend gilt das Beziehungsprinzip Der Portefeuilleschutz wird bis zum MB-Workshop konkretisiert  Produkte: kundenfreundlich heisst, den Gegebenheiten des Kanals angepasst, nicht nachlässig in Risikogesichtspunkten; werden mehr sehen einheitliche Preise werde ich ebenfalls noch näher erklären harmonisierte Provisionierung: umso wichtiger, wenn aktiver Einsatz Internet erfolgen soll, was wiederum für Schaffung von Freiraum wichtig ist. high availability and consistency of customer data harmonized commissions for transactions over agents and internet Eurapco - Creating value together 29

30 Finland / Tapiola Market Description
Market Channel distribution Finland / Tapiola Market Description MARKET Market value 2008:15bn Finland is predominately a direct market Exception; car dealers and tied agents / franchise office Tapiola Tapiola Group is at present a financial conglomerate consisting of seven companies 13.97% of the market = 3rd largest Group 164 Sales point of which 61 are own offices and rest is exclusive service offices 3000 employees Eurapco - Creating value together

31 Multichannel strategy
Tapiola Multichannel strategy Agents = ; Car dealers and Agents = Franchise sales offices which are exclusive to Tapiola No price or service differentiation between channels Brokers mainly in industrial business Increased importance of call-centres and internet as sales channels Bancassurance related concepts increasing in importance Increased importance of white-label products Eurapco - Creating value together

32 Thanks for your attention Muchas GRACIAS
They asked rabbi Ben Zoma: Who is a wise man? He said The man that always finds something to learn from the others Thanks for your attention Muchas GRACIAS Eurapco - Creating value together


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