Transcript AXA Belgium

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
Suduiraut - 10 & 11 June 2004
SLIDE 2
High savings rate has fueled a strong
growth in Life and Savings
Gross Prem ium s
(m ios €)
30.000
CAGR : 9,5%
25.000
20.000
CAGR : 7,6%
CAGR : 25,6%
15.000
10.000
5.000
CAGR : 4,1%
1996
P&C
1997
Workers' Compens.
1998
1999
Individual Life
2000
2001
Group Life
Suduiraut - 10 & 11 June 2004
SLIDE 3
2002
0
2003 (e)
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%)
10.000
9.000
8.000
7.000
6.000
5.000
4.000
3.000
2.000
1.000
0
Evolution
800%
672%
8.230
7.907
700%
600%
6.066
500%
310%
124%
30%
36%
1.314
1.702
300%
2.841
1.268
400%
1.488
1.024
400
200%
100%
0%
Brokers
Source: UPEA
2002
Tied
Agents
Mutual
Bank
Suduiraut - 10 & 11 June 2004
SLIDE 4
Direct
Evolution
GWP (Mio€)
1994
The Belgian insurance market has
undergone considerable concentration
x 1.000.000 €
1996
2002
4 500
4.500
4 000
4.000
3 500
3.500
3 000
3.000
2 500
2.500
2 000
2.000
1 500
1.500
1 000
1.000
500
500
0
0
Ro
CG
A
F
S
ya orti M A
ER GF
le
P
sA
Be
lge G
AB
B
AX
A
W
B
int
Pa
KB
t
ert rioti
qu
hu
e
r
FO
R
TI
S
AX
A
SM
AP
Top10 = 74%
of the market
KB
C
IN
G
DE
XI
A
Top10 = 85%
of the market
Suduiraut - 10 & 11 June 2004
SLIDE 5
W
IN
AG
F
TE
RT
HU
R
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
Suduiraut - 10 & 11 June 2004
SLIDE 6
Contents
 1 : Evolution of the Belgian Market
 2 : AXA in Belgium
 3 : Results Summary
 4 : Strategic Priorities
 5 : Conclusion
Suduiraut - 10 & 11 June 2004
SLIDE 7
Our mission: Financial Protection
Estate
Customer needs
planning
Retirement
Annuities
Asset
accumulation
Investments
Savings
Life protection
Asset protection
Asset
management
Consumer credit
Mortgages
Credit cards
Auto, home, property, liability
Life stages
Suduiraut - 10 & 11 June 2004
SLIDE 8
Sourced bank
products
1999 - 2001 : merger of AXA in Belgium
Suduiraut - 10 & 11 June 2004
SLIDE 9
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, ...
Suduiraut - 10 & 11 June 2004
SLIDE 10
2002 : integration into a financial
protection group
Suduiraut - 10 & 11 June 2004
SLIDE 11
A client facing organization
Corporate Clients
Individual Clients
Bank agents
Other channels
Brokers
Brokers
Direct
Car Manufact., Viaxis,
...
Product
Management
Bank Products
Back Office
Bank
Product
Management
Life & Invest
Product
Management
P& - Indiv. &
Product
Management
Medium / Large Businesses
Small businesses
Back Office
Back Office
Insurance-Corporate Lines
Insurance- Indiv. & Small businesses
Support functions in synergy
Suduiraut - 10 & 11 June 2004
SLIDE 12
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
Suduiraut - 10 & 11 June 2004
SLIDE 13
Contents
 1 : Evolution of the Belgian market
 2 : Organisation of AXA in Belgium
 3 : Results Summary
 4 : Strategic Priorities
 5 : Conclusion
Suduiraut - 10 & 11 June 2004
SLIDE 14
AXA is a leader of the Belgian market
Market
Share 2002
Market
Volume 2002
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€
11.8%
14 432 M€
# 4 Individual Life
11.5%
11 089 M€
# 3 Group Life
12.8%
3 342 M€
13.9%
22 305 M€
 #1 P&C
 #5 LIFE
 #2 P&C + LIFE
Suduiraut - 10 & 11 June 2004
SLIDE 15
We have stabilized our market share in
P&C ...
mio €
1.600
1.400
70,0%
60,5%
6,5%
60,0%
50,0%
1.200
15,4%
1.000
40,0%
25,4%
30,0%
800
7,8%
20,0%
600
-10,0%
10,0%
400
0,0%
200
-10,0%
0
-20,0%
AXA
2000
2001
Fortis
2002
SMAP
KBC
Winterthur
delta 2000-2002
2002 : size of the market 7 873 M€
Source: UPEA
Suduiraut - 10 & 11 June 2004
SLIDE 16
AGF
Growth
Written premiums
Global growth of the Belgian market 2000 - 2002 : + 10,9%
… 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.
Suduiraut - 10 & 11 June 2004
SLIDE 17
In Life we generated growth and improved
earnings to € 94 mio in 2003
Global growth of the Belgian market 2000 - 2002 : + 12,1%
5.000
4.500
4.000
140,0%
127,4%
120,0%
91,2%
-24,4%
100,0%
3.500
3.000
80,0%
49,6%
2.500
2.000
60,0%
40,0%
16,8%
-21,4% 20,0%
1.500
1.000
0,0%
-20,0%
500
0
-40,0%
Fortis
2000
2001
KBC
2002
SMAP
ING
AXA
delta 2000-2002
2002: market size 14 432 M€
Source: UPEA
Suduiraut - 10 & 11 June 2004
SLIDE 18
Dexia
Growth
Written premiums
mio €
In Life, premiums growth is significant
and outperforming traditional insurers
and bank-insurers
Belgian market
18.138
14.432
12.870
13.294
2000
2001
10.064
1999
2002
2003 (*)
AXA Belgium
2.125
1.742
1.689
2001
2002
1.129
907
1999
2000
Suduiraut - 10 & 11 June 2004
SLIDE 19
2003 (*)
We renewed growth in bank savings
accounts and ...
Net New Money
In € Mio
677
724
273
2001
AUM Savings accounts
2002
2003
5.749
4.348
2001
Suduiraut - 10 & 11 June 2004
5.025
2002
SLIDE 20
2003
… doubled our market share in mortgage
loans (12% in 2003 vs. 5% in 2001)
Mio €
1.926
2000
1500
941
1000
377
500
141
0
195
2000
Mortgage loans
454
217
248
273
176
210
212
2001
2002
2003
Consumer loans
Suduiraut - 10 & 11 June 2004
Commercial loans
SLIDE 21
Expenses are being reduced ...
Economic expenses (in Mio €)
689
647
620
2001
2002
2003
- 10% over 3 years
Suduiraut - 10 & 11 June 2004
SLIDE 22
... while strictly controlling FTE evolution
6.512,0
6.500,0
Headcount (FTE)
6.233,0
6.000,0
FTE
5.860,0
5.772,0
5.613,2
5.500,0
5.322,5
Suduiraut - 10 & 11 June 2004
SLIDE 23
1.
1.
20
03
1.
1.
20
02
1.
1.
20
01
1.
1.
20
00
1.
1.
19
99
1.
1.
19
98
Satellite firms Ardenne Prév., Auxifina, Assurity, Viaxis and S&C excluded
1.
1.
20
04
5.119,4
5.000,0
Top of mind and spontaneous awareness (april
2004)
100%
90%
80%
70%
70%
58%
60%
50%
42%
40%
40% 40%
30%
23%
17%
20%
14% 12%
10%
0%
Fortis Dexia
AXA
KBC/
CBC
ING
Ethias
Argen
ta
BBL
10% 9% 8% 8% 7%
7% 6% 5% 5%
4% 4% 3% 2%
1% 1%
OMOB DVV
/
Verze- AG
SMAP kering
BACO
M&N
B
P&V
AGFWinter
Assu
thur
bel
Bank
Deuts Vader- Verze
Gener Cente
van
che
land- kering
ali
a
de
Bank sche en De
UAB
Artesi
a
spontaneous
70%
58%
42%
40%
40%
23%
17%
14%
12%
10%
9%
8%
8%
7%
7%
6%
5%
5%
4%
4%
3%
2%
1%
1%
also spontaneous
45%
47%
28%
27%
32%
17%
16%
12%
8%
7%
8%
8%
6%
6%
6%
4%
5%
4%
3%
4%
3%
1%
1%
1%
TOM
25%
11%
15%
12%
8%
6%
2%
2%
4%
2%
1%
1%
1%
1%
1%
1%
0%
1%
1%
0%
0%
0%
0%
0%
TOM
also spontaneous
Suduiraut - 10 & 11 June 2004
spontaneous
SLIDE 24
Perceived activities AXA vs competition
100
90
80
70
Don't know
insurance
both
bank
60
50
40
30
20
10
0
Fortis
Dexia
KBC
ING
AXA
Suduiraut - 10 & 11 June 2004
Ethias
SLIDE 25
Contents
 1 : Evolution of the Belgian Market
 2 : AXA in Belgium
 3 : Results Summary
 4 : Strategic Priorities
 5 : Conclusion
Suduiraut - 10 & 11 June 2004
SLIDE 26
Priorities in AXA Belgium’s Strategic Plan
Increase growth
Maintain profitability
Improve efficiency
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SLIDE 27
Increase growth in Life and Savings
 Double the bank’s size
 Increase loyalty
 Develop cross-selling with bank and P&C database
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SLIDE 28
Maintain profitability in P/C
 Retention of existing base
 Focus on best risks (seniors, geographical focus…)
 Further improve claims management
 Further streamline processes
Suduiraut - 10 & 11 June 2004
SLIDE 29
Improve efficiency
 A continuous process
 Further cut cost base
 Complete systems upgrading
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SLIDE 30
An integrated customer policy for
growth and loyalty
Our growth strategy is mainly based on :
 customer loyalty
 growth through cross-selling
Suduiraut - 10 & 11 June 2004
SLIDE 31
Significant potential of our customer base
AXA Belgium owns 50 % of Belgian households
Life &
Savings
Bank
702.283
Risk
1.473.700
267.305
Total : 1.903.007
229.683
1.093.847
108.915
41.255
96.380
65.622
Credits & transactional
Bank
312.172
Suduiraut - 10 & 11 June 2004
SLIDE 32
Our potential
Cross-selling rate is only 1,5 contracts.
Product groups
number of
Cross-selling rate: number of AXA products hold by household
1 product group
2 product groups
57%
21%
10% 10%
2,6%
3 product groups
4 product groups
5 product groups
0%
20%
40%
60%
80% 100%
Suduiraut - 10 & 11 June 2004
SLIDE 33
As you sow, so you reap
1st step : Customer lo
Suduiraut - 10 & 11 June 2004
SLIDE 34
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”
342,793 Motor Wildcard
families
763,632 Total customer base Motor
 Action :
 The next claim is free
Suduiraut - 10 & 11 June 2004
SLIDE 35
Home Wildcard (March 2004)
 Target :
 AXA customers with no claim in
the past two years
500,000 Home Wildcard
families
 Goal :
 Cut lapse rate by 20 % on
« good risks »
 Action :
 € 200 cash, if claim > € 1.500
Suduiraut - 10 & 11 June 2004
691,000 Total customer base Home
SLIDE 36
Mass Affluent
 Target :
 AXA customers with more than
€ 50.000 assets under management
 Goal :
 Increase level of Mass Affluent
‘AUM of 5 %
65,177 Mass Affluent
(AUM > €50,000)
702,283 L & I customer base
 Action :
 Free banking account + free banking cards
 Yearly financial check-up
 Services & relationship advantages
Suduiraut - 10 & 11 June 2004
SLIDE 37
As you sow, so you reap
2nd step : Cross-selling
Suduiraut - 10 & 11 June 2004
SLIDE 38
From Motor to Home
 Target :
 Motor Wildcard without Home
342,793 Motor wildcard families
 Goal :
 10 % cross-selling
195,000 Wildcard customers do not
have Home insurance
 Action :
 2 months free on purchasing Home
insurance
 Home Wildcard if no claim in 2 years
Suduiraut - 10 & 11 June 2004
SLIDE 39
« Good risks » targets on which crossselling actions will be implemented
Cross-selling targets
500,000 Home Wildcard
families
342,793 Motor Wildcard
families
691,000 Home
customer families
763,632 Motor customer families
65,177 Mass Affluents
(exp. > €50,000)
702,283 L & I customer families
2 nd step: L&I customer families
who over 45 years
Suduiraut - 10 & 11 June 2004
SLIDE 40
HIP concept for our VIP customers
HIP
HAPPY
IMPORTANT
PEOPLE
Happy
Drive
Happy
Home
Happy Life
Happy You
Differentiation:
Differentiation:
Differentiation:
Differentiation:
1. Wildcard
1. Wildcard
2. Confidence
guarantee
2. VIP product
(in co-operation
with AXA Art)
1. Pension buildup &
management
programme
1. MA programme
AUM > 50,000:
products, services
& relationship
advantages
Suduiraut - 10 & 11 June 2004
SLIDE 41
Contents
 1 : Evolution of the Belgian Market
 2 : AXA in Belgium
 3 : Results Summary
 4 : Strategic Priorities
 5 : Conclusion
Suduiraut - 10 & 11 June 2004
SLIDE 42
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
Suduiraut - 10 & 11 June 2004
SLIDE 43