AXA posted what it described yesterday as a “strong performance in the first half of 2017,” revealing underlying earnings per share up 5% and
particularly strong growth in the UK market within commercial lines and healthcare.
Success in the UK commercial space was driven by management of the discount rate impact, double digit growth in
online SME and continued successful expansion into the mid-market space, according to AXA, but that uptick came alongside a slide in personal lines, with revenue growth at 1.3%.
“I think personal lines is clearly challenged in a number of ways,” Amanda Blanc, group CEO, AXA UK and Ireland, told Insurance Business in an interview. “From the personal injury discount rate change to the recent government announcement that the sale of petrol and diesel cars will be scrapped post-2040, constantly changing external factors mean personal lines must adapt to a new world. Add to that continued problems around claims management companies, whiplash claims and fraud, and “all of that creates an ultra-competitive environment,” Blanc commented.
AXA’s strong mid-year results are an “excellent indication of the resilience of our business,” in the face of wider challenges in the UK market, according to the CEO.
“The UK market is always challenging. We’ve got aggregation here – many other countries don’t have that. We have a very active direct and intermediated space, and we’ve got some of the highest levels of insurtech happening in the UK,” Blanc explained. “An alternative way of saying that is that there are huge opportunities in this market to become better and to do things differently.”
The company has made a push for efficiency and has a strategic transformation program, Ambition 2020, all of which Blanc says is ultimately about delivering for the customer.
“We need to be efficient for our customers because their expectation of organisations is that they will be slick and they will be efficient,” she said, adding that in today’s age consumers will compare the service they get from their insurer with the experience at a digital-first brand such as Amazon.
“I think we have to invest in digital tools and in the use of data to make our customers’ lives easier,” Blanc commented, pointing to work that AXA has done in speeding up travel claims by allowing e-notifications and ensuring that customers receive payments faster. The insurer is also using technology to get customer satisfaction ratings, allowing policyholders to instantly give feedback on the claims experience.
“That’s brilliant for us because it means we can learn, and we can get better,” she said.
Blanc added: “So with efficiency – and you’ll have seen from the Group results that our expense ratio has improved, our enlarged expense ratio has improved and is moving really in a good direction – that is all so we can be competitive and give a better service to our customers.”
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