It’s fair to say that yesterday was a day of celebration for AXA. As the company announced its financial results for 2016 it revealed that it had shattered the €100 billion marker for the first time as a group and that in the UK and Ireland its revenue had surged by 8.1% to stand at £4.4 billion with notable growth across all lines of the business.
However, with the company highlighting success in its direct motor book and pointing to increased digital and tech investments, where does that leave brokers? Insurance Business spoke with AXA group CEO for UK & Ireland Amanda Blanc to find out.
“I think you have to be honest and recognise the challenges, particularly in retail, of the non-direct model,” she said. “In the direct model you get to take the rough with the smooth, to deal with things like accidental damage where you have the opportunity to look after the customer and the opportunity to cross-sell and look at the ways to get money from that customer – with the broker model you don’t get to do that.
“So you have to be technically excellent - and that’s where we’ve been focusing the business in the last few years: ensuring we get that technical excellence in the retail broker model. We had some work to do and I think we’re now seeing the benefits of that.”
So in this increasingly digital environment, how can brokers stay relevant? According to Blanc it’s about considering their own value while making sure they keep pace with changes.
“I don’t think the broker should be concerned about the insurer going direct – they should be concerned about keeping pace with the market, just as we are,” she explained. “Ensuring that they are as digitally savvy as they can be, that they are responding to changes and thinking about what the customer actually wants from their insurer and broker. A broker is there to provide much-needed advice and they can focus on that.”
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Blanc explains that insurers and brokers both face similar challenges in that the world is increasingly going digital and customers are coming from different channels – they’re moving from phone to online and “they expect a proposition to be mobilised and that they can look at it from an app.”
Customer expectations are growing too – and the broker’s role has to move with the times, just as an insurer has to.
“For an insurer we’re no longer just a company that deals with claims, we’re also a company that prevents claims from happening,” she noted.
“So that’s what you have to think about – what’s the value proposition you offer to customers? Every organisation needs to look at their relevance and earn relevance with customers. That can take many forms – it’s about providing a good product, a good service, about being transparent. You have to be all of those things because your future customer base – and your existing customer base – expects that.”
Selling Bluefin last year was part of AXA becoming more “strategically focused” on the areas it wants to concentrate on, Blanc explained, and now the company is not looking back, it’s looking forward to opportunities.
“We sold the Wealth business, we sold Bluefin at the end of the year, so you could almost forgive the business if it had become distracted by all the things that were going on – but we didn’t, we just carried on doing what we said we would do,” she said.
“The fact that we’ve not only been able to continue to be profitable but the fact that we’ve been able to grow in each of our key market areas - it’s very unusual to see that happen. We’ve been strong in all aspects of the business while also investing heavily – in digital, in claims, and so on – we’re in a good place. We’re not just milking the business: we’re investing in it and finding ways for it to grow going forward and that’s an exciting place to be.”
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