We don’t do one-night-stands, only long-term relationships

A marriage is often stronger when the partners complement each other, Belgian insurance company Ageas believes. But that requires trust, and sometimes putting the other person first.

‘If I were to recommend Ageas on a dating website, I would describe her as a beautiful and very experienced bride looking for a long-term partner,’ Hans De Cuyper, CEO of AG Insurance jokes.  ‘Just to be clear: we’re not up for speed dating or one-night-stands.  That’s not how we view cooperation.’

Of course that long-term relationship doesn’t happen overnight. First there’s the courtship, which is new and exciting every time, says the insurer. ‘We prefer to do our own screening to start off with, after which a pre-selection follows. That’s why we’re not skimming the market yet, but once in a while you spot a potential partner, and sometimes it’s love at first sight. It helps that we’re able to demonstrate that we’re already collaborating with strong partners in various markets.’

A good match doesn’t mean the partners have to be equal. ‘A marriage is often stronger when the partners complement each other,’ De Cuyper notes. ‘Of course the vision must be clear. Where do we want to go? But the culture and standards can certainly differ. The power of collaboration is in those points where we complement and find each other.’

Ageas does not have a strict blueprint for the courting process, which leads to a ‘marriage’ after about 24 months. Every case is different, but there are a few typical consecutive steps, De Cuyper indicates. ‘It always starts with informal contact at the highest level. After that, working groups start drafting a few collaboration concepts, followed by contract negotiations. This entire process, which can easily take 24 months, also includes difficult times, but we have the flexibility and the patience to overcome these.’

Trust

In some markets, Ageas and its partner enter a ‘green field’, starting up a new enterprise from scratch. ‘In that case we have to find out our partner’s presence in that market. For example, which market share does it hold in the banking sector? How many clients, how many offices? To us, that is an important analysis for the first business plan we’ll agree on together.’

It takes trust and courage to partially relinquish control. How well does that work? ‘It always has to come from both sides,’ De Cuyper indicates. ‘During the first years, most of the cultural flexibility has to come from us. In the end, we’re the guest in a new market where our local partner often holds a top position. Where possible, we join the management, often in only a few positions where Ageas can make a difference.

Human factors contribute too. ‘During negotiations, the discussion about collaboration between the partners is often contained to a select few in the highest ranks,’ De Cuyper explains. ‘After the marriage is announced, you need some time to convince the rest of the company you’re collaborating with of Ageas’ contribution and added value. Gradually we’ll create a culture of open dialogue and flexible cooperation, and our contribution is often greater than our capital participation. A great example of this is Muang Thai in Thailand.’

Broad interpretation

Ageas has a broad interpretation of partnership. It might be at the core of a partnership network, but it also stimulates these partners to learn from each other. ‘In Asia, we organise an annual agency convention, a sort of network event with our partners who work with insurance agents,’ De Cuyper illustrates.  ‘By bringing them together, they can exchange ideas. It doesn’t always have to come from us. Another great initiative are the partnership days where we bring together our partners’ top people from across the globe in one location. For a day and a half, they participate in an intensive programme with guest speakers and trend watchers. There’s also a lot of space for dialogue between those partners. This often yields great results, like new ways of cooperation between two banks from different countries.’

Big data must always serve to improve the customer experience

Aside from its partnerships with banks and bancassurance companies, Ageas is also open to

‘We’re now seeing everything that’s created in the new economy also starting to affect our sector,’ says Hans De Cuyper, CEO of AG Insurance.  ‘Take start-ups in the mobility or real estate sector which bring in a brand-new business model, like self-driving cars and connected homes (where appliances are connected to the internet, ed.).’

Data is the fuel of the 21st century economy, De Cuyper notes. ‘We’re now in a phase where we have to determine which of these developments will be of strategic importance to us, and which will not. ’This pertains to the knowledge, expertise and activities Ageas as a group wants to develop, he explains. ‘For example, first we helped our partners in Asia develop products and risk management. Maybe we can also help them analyse big data. I’m convinced that we can always continue to offer added value in such a long-term partnership.’

Can he give an example of this data analysis? ‘Can we make marketing campaigns more targeted? Are there ways to optimise the repairs network by learning from our claims settlements? Which data will become important factors in better risk selection? Telematics in cars can monitor driver behaviour, and create added value for the client. Young people can use it to influence their car insurance premium.’

New era

Big data signals the beginning of a new era for the insurance sector. The data Ageas collects today is ‘fixed’, De Cuyper illustrates. ‘It’s been recorded at the time of underwriting an insurance or of medical acceptance. The future is in more continuous data. This affects insurance technology, but also customer service.’

In the real estate sector, big data can affect fire insurance, among other things. ‘A washing machine leak is covered by fire insurance,’ De Cuyper illustrates. ‘If the client discovers this leak, an expertise with reports follows until he finally gets his money to find a repair service. Can’t we place a detector on this washing machine which will instantly indicate a leak? Before the client even knows an expertise is needed, we can already send a repairman from our own network to solve it. Big data not only helps risk management, but must also always improve the customer experience.’

Big bang

Will self-driving cars change the car insurance profession in this new economy? De Cuyper adds nuance to the question, which he envisions will only materialise in the medium term. ‘We can’t make the mistake of thinking that everything is new, or that it will be introduced with a big bang. First, infrastructure adjustments will be required. Moreover, transferring autonomy from the driver to the car is a gradual process. For example, we already have cars that can brake and park automatically.’

Nevertheless, he admits it begs interesting questions. ‘How will the legislator choose to view self-driving cars? Will liability change? In a self-driving car, is the person inside it still liable, or does liability transfer to the company that manufactured the car?’

Ageas will not wait for this evolution to happen, but pro-actively anticipates it. ‘Since September, we are the first player in Belgium to give insurance premium discounts to drivers who invest in new safety systems. That doesn’t just help our business, but also promotes general road safety.’