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Admiral Group plc - Why we are successful.

Pricing

paul
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Admiral Group plc - Why we are successful.

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    3. Pricing

    4. Data

    5. Analyses

    7. Philosophy of pricing : what is a good risk?

    8. Our approach to new initiatives

    10. Why are we successful?

    11. Because were good at handling motor insurance claims.

    12. More Specifically Getting customers back on the road following a crash Dealing with their liability to third parties

    13. Customers like us 91% say they would renew their policy following a claim Sometimes we cant pay them what they want

    14. We settle third party bodily injury claims faster than ever

    16. Liability scenarios Hit in rear Misleading signals Pedestrians

    17. We settle 25% of claims without a lawyer getting a fee

    18. We reserve conservatively

    19. Were good at detecting fraud Soft fraud Hard fraud

    20. People Claims Management over 150 years experience 10% attrition in general staff We laugh a lot Especially at fraudsters

    22. What does UK operation cover? Sales Customer service Renewals Outbound Quality

    23. Where are we based?

    24. Our structure until June 2008

    25. Importance of aggregators

    26. New structure

    27. What the new structure allowed us to do No change to the culture Manage a portfolio of brands Greater staffing flexibility Find staffing synergies Extend operating hours Etc

    28. Discounting Discounting introduced 19 September 07 Discounting of ancillary products only Increase ancillary penetration Capture additional income at renewals stage First renewals coming now

    29. Discounting example Sale of policy is secured Sales person offer first ancillary Then second ancillary

    31. Being first Being focused Being frugal ...and genuinely passionate about what we do Why we have been so successful

    32. Being first Confused.com was not the first price aggregator But it was one of the first to go big on TV... ...benefiting from high TV response rates in early years... ...and higher rates of returning customers today

    33. Being focused Confused.com focused on price comparison for car insurance Relentless attention to the detail of the sales process delivered industry leading conversion rates... ..and resulting higher volumes in a single product area enabled the negotiation of higher revenue / sale from providers...

    34. Being frugal Part of the Admiral DNA transferred to confused.com Management overheads kept to a minimum Clear focus on profitability of every single transaction

    35. Future success

    38. The Spanish market Direct Players Marketing Spend in first Semester 08: Eur 36m (+29% vs 07). Zurich Connect started in May and today represent 17% of the spend

    39. Balumba : half year results Vehicle count 60,000 at end June 08 (+258% on June 07, +27% on Dec 07) Total premium 13.8m (6.6m at June 07) Ancillary contribution 2.0m (0.9m at June 07). 73.6 per policy (61.0 at June 07, increase 21%) 2008 Loss Ratio 107% (versus 149% for 2007 at the same point in time) Loss in period GBP 800k (1.1m) 203 Staff based in Seville

    40. Balumba: approaching our 2nd birthday So far, Balumba has proved to be able: To generate leads and acquire business To generate additional income Challenge of year 2/3: Continue with the improvement of the loss ratio

    41. Balumba: improving the loss ratio (I) Maturity factors: Scale Age of portfolio

    42. Balumba: improving the loss ratio (II) Internal factors: Pricing More questions and more data Underwriting quality Claims Approved repairers Proactivity

    44. BIG MARKET: German motor insurance market is with 20.5 bn EUR annual premium the biggest in Europe, which allows to grow a profitable business even if only a niche player. Overall the market is loss making, but there are quite a few players (just like in the UK market) that are making money on motor alone. BIG MARKET: German motor insurance market is with 20.5 bn EUR annual premium the biggest in Europe, which allows to grow a profitable business even if only a niche player. Overall the market is loss making, but there are quite a few players (just like in the UK market) that are making money on motor alone.

    46. My colleagues have already presented you the key factors to make a motor insurer successful. The question remains: Why would AdmiralDirekt be successful? The German direct market is still in an early stage. To use the advantages of a direct insurer are key: You can ask more pricing relevant questions and change prices more often than a traditional insurer. Already with a limited Marketing budget you can gain significant share of voice in TV advertisement. Through active central claims management you can still gain an advantage of control of claims cost. In all this the key is to combine Admiral UKs experience and a team in Germany that knows the German market and shares the enthusiasm of a start up. To find the balance of learning but not blindly copying, to understand the German customers, but also test new products. For all this you need the right people. And do we have them. Let me show what the German team has achieved in the last year since launch. 3 main principles: Getting things done Spend the money just as it was your own Test, measure, analyse and adjust Push for high performance in an environment people like to work in, an environment of trust and supporting each other My colleagues have already presented you the key factors to make a motor insurer successful. The question remains: Why would AdmiralDirekt be successful? The German direct market is still in an early stage. To use the advantages of a direct insurer are key: You can ask more pricing relevant questions and change prices more often than a traditional insurer. Already with a limited Marketing budget you can gain significant share of voice in TV advertisement. Through active central claims management you can still gain an advantage of control of claims cost. In all this the key is to combine Admiral UKs experience and a team in Germany that knows the German market and shares the enthusiasm of a start up. To find the balance of learning but not blindly copying, to understand the German customers, but also test new products. For all this you need the right people. And do we have them. Let me show what the German team has achieved in the last year since launch. 3 main principles: Getting things done Spend the money just as it was your own Test, measure, analyse and adjust Push for high performance in an environment people like to work in, an environment of trust and supporting each other

    47. Admiral Milestones a year after launch

    50. ...with clear ongoing evolution.

    52. .until May 30th!

    53. ConTe.it is innovative across the value-chain

    54. and on people management

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