JakMar: Targeted Direct Marketing Croatian Insurance Days 2011 Bogomil Marn – Partner, JakMar

Established markets

Percentage Risk Premium Main Aims - focus on risk add a new and profitable distribution channel: Direct Marketing increase the level of client’s… Percentage Risk Premium Premium Per Customer Profit

Complementary to other marketing channels, without being invasive Direct Marketing: complementary Targeted, personalized Direct Marketing Complementary to other marketing channels, without being invasive Direct Marketing Agent Broker Bancassurance

Insightful, confidential, no cost and no obligation Feasibility Study Partner: Information gathering JakMar: analysis and consideration JakMar: Report and Presentation Questionnaires Phone and email follow-up Data extract Interviews (if necessary) Business objectives Regulations Customer base SWOT analysis Marketplace Database extract Offers Segment Targeting Direct Marketing Campaign recommendation Financial projections Insightful, confidential, no cost and no obligation

Project overview Feasibility Study Campaign: Testing Campaign: Rollout

Flexible Financial Structure 50% 50% Insurer JakMar 50% Swiss Re 25% Allowance of Cession in Year 1 - Agents

Direct Marketing of Risk Products Generate additional business in cost effective manner Up-sell / cross-sell commodity insurance products to non-life, health, pension, bank Some clients simply prefer to buy direct (10-20% growing) Generate leads for agents Improve persistency and client loyalty Allow agents to concentrate on acquisition of new clients and on sizable sales

Economic crisis creates imbalance Economic crisis has caused a reduction in cash value of Investment products An increase in revenue from your Risk portfolio can help to level out this imbalance Revenue from Risk portfolio less vulnerable to changes in the market

Credit/Debit Card Provider The psychology of Direct Marketing The affinity that the customer has with the institution plays an important role The customer is more likely to respond favourably to Direct Marketing if the institution is held in high esteem Utility Company Checking Bank Credit/Debit Card Provider Savings Bank General Insurer Pension Life Unit Linked Life Conventional

The psychology of Direct Marketing The quality of the communication will also effect the customer’s response Recognition Expectation Understanding Affinity

Personalization + Relevance The key to successful Direct Marketing Direct Marketing can only be successful with the following: Personalization + Relevance

Targeting + Segmentation The key to successful Direct Marketing Direct Marketing can only be successful with the following: Targeting + Segmentation

Core Risk Product Strategy Campaign Month 1 1 2 7 3 14 4+ New Products/New Services Target Population 100,000 Initial Product 10,000 (10%) Initial Product 90,000 (90%) Increase Offer 3,000 (30%) Increase Offer 7,000 (70%) Re-mail #1 Initial Product 5,400 (6%) Re-mail #1 Initial Product 84,600 (94%) Further Product 600 (20%) Re-mail #1 Increase Offer 1,260 (18%) Re-mail #1 Increase Offer 5,740 (82%) Re-mail #2 Initial Product 2,538 (3%) Re-mail #2 Initial Product 82,062 (97%)

High volume, commodity Risk products Cultivation of the YES customer Tested strategy to educate customer into buying ever more sophisticated products Critical illness Term Assurance Health Insurance Hospital Expenses Personal Accident Accidental Death High volume, commodity Risk products

Post economic crisis strategy Build in another entry level, of high value, low cost products Critical illness Term Assurance Health Insurance Hospital Expenses Personal Accident Accidental Death HIGH VALUE, LOW COST ENTRY LEVEL

High Value, Low Cost Products Designed as a preliminary stage in the overall marketing process, in order to maximize DM responders whilst being profitable in of itself Products can be sold before traditional risk, or combined to form value added packages Products may include: (Life and Non Life portfolios) Accidental Critical Conditions; Hospital cash International Medical Second Opinion

Accidental Critical Condition (ACC) Covers critical conditions resulting from an accident Lump sum payment of sum insured at end of survival period – 30 days Sum insured is limited to EUR 100,000 per life Covered conditions: Major burns; Blindness; Deafness; Coma; Major Organ Transplant; Paralysis ;Loss of Limbs

Medical Second Opinion (MSO) Remote Medical Second Opinion Program Partnered with a wide group of World Leading Medical Centers (WLMC). E.g. Harvard M.S; John Hopkins; London’s Royal Marsden Creates additional new clients with details (phone, address, etc.) Spouse, Children, Parents All claim administration handled by Third Party Administrator (TPA) No age, gender or occupation restrictions; no underwriting

Direct Marketing can create a positive dialogue with customers Long term value & customer loyalty Direct Marketing can create a positive dialogue with customers

Juggling short-term with long-term goals “The crisis of short-termism” “The problem is that the narrow focus of short-termism does not maximize profits by thoroughly tapping customer loyalty and satisfaction opportunities, but instead leads to customer churn, which destroys loyalty and strengthens competitors…” - Peppers & Rogers

Juggling short-term with long-term goals Immediate portfolio benefits Profitable long–term distribution channel

Skip the learning curve Partners get the benefits of JakMar expertise from day 1 Time Resources Inefficiency Ineffectiveness Missed opportunities

Our Projects in Croatia First Campaign in Croatia done by JakMar in year 2004 Since then we have been successfully cooperating with 5 insurance companies 11 campaigns implemented to date Total premium generated  amounts to greater than 1.3 million since 2004

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