Allianz Direct plans to expand

The direct insurer Allianz is currently pointing to a new beginning, although entering the market was initially more like a “stumbling start”. The idea of ​​a technology company with insurance expertise, which Kroetz’ predecessor Bart Schlatmann had given out, overwhelmed many customers. In addition, processes and services did not always function smoothly. The annoyance was great and erupted in a large number of negative reviews on portals such as Trustpilot.

It also turned out that there was no money to be made with a large proportion of the approximately 750,000 customers taken over from the predecessor organization Allsecur. As a result, unprofitable business was divested and the customer portfolio was streamlined.

In the old days of Allsecur, many customers came mainly because of the low prices. This price-sensitive group switched to a cheaper provider after an average of 18 months. However, the following applies in the industry: a customer must remain with an insurer for at least three years, better four years, so that it is worthwhile for them.

Strategy is controlled in Munich

The procedure for the forthcoming expansion into France is the same as in previous markets: one of the large European insurance markets is to be approached with the same platform and products for motor, travel and liability insurance.

As in the other foreign markets, the strategy is controlled from Munich. On site, the products are adapted to the respective country specifications by pricing and service specialists. Between 120 and 200 employees will be in France.

Further European expansion is to follow this pattern. In addition to France, Allianz Direct conducts market research in four other countries. A preparation time of three months is considered internally to be feasible for the opening of a new market, in eight weeks a new insurance product should be ready for launch in an existing market.

In Italy and Spain, for example, travel, legal protection and motorcycle insurance will also be offered in the coming year. “We focus on segments in which we earn money over the long term,” says Philipp Kroetz.

Allianz Direct now has around 300,000 customers in Germany, and the number in the home market has been growing again since October. Compared to competitors such as Huk24 with around 2.2 million customers, Allianz Direct is still a small provider. This is actually not compatible with the self-image of the Dax group, which is to rank among the top positions in all markets.

We have the idea that in three years we will be all over Europe. Allianz Direct boss Philipp Kroetz

However, Huk24 has been on the market for over two decades, as has the successful Generali subsidiary Cosmos Direkt. The time advantage is therefore large. The competitors see Allianz’s offer accordingly: “Allianz Direct doesn’t make me nervous,” said Uwe Stuhldreier, Chief Sales Officer at Huk24, recently.

High priority for CEO Bäte

At Allianz, even CEO Oliver Bäte recognizes the progress. Long before the start of Allianz Direct, he had always emphasized the high priority of the project for the group. At the group’s headquarters near the English Garden, people had been watching the hustle and bustle at Allianz Direct from afar for a long time in the loft-like working atmosphere at Munich’s Ostbahnhof.

Bart Schlatmann, a very self-confident Dutchman with extensive experience in internet business at ING and the Russian Sberbank, who was involved in the project, did the rest to emphasize the independence of the unit and not to have too intensive contact with the other units of the group allow.

With Schlatmann’s departure a year ago and the takeover by Philipp Kroetz, however, the connection became deliberately closer. Kroetz has been with Allianz for over eleven years and was previously Chief Transformation Officer at subsidiary Allianz Partners. Supplementary insurance is offered there, for example for trips.

From this time he knows Sirma Boshnakova, who once managed Allianz Partners and is now responsible for Allianz Direct on the Group Board of Management. In addition, a number of management positions at Allianz Direct were exchanged this year with people who are believed to be capable of making the direct insurer a success story after all.

Internally, the online insurer is now seen as a springboard for further career steps because of its high status within the group. “Anyone who wants to get ahead in the company now switches to Allianz Direct,” says a senior employee with deep insights into Allianz.

The strategy is beginning to bear fruit: Allianz Direct achieved a combined ratio of 93 percent on the German market after nine months. The more this ratio of claims payments and premium income falls below the one hundred percent threshold, the higher the profit for the insurer. Allianz Direct is even better off in the Netherlands than in Germany.

The markets in Italy and Spain are also expected to reach this level, but are still a long way off. For Allianz Direct as a whole, this currently results in a combined ratio of 100.2 percent, which is just below the break-even point.

If you want to get ahead in the house, you can now switch to Allianz Direct. A senior executive with deep insights into Allianz

So that soon all countries can start making profits, costs have recently been reduced by between 30 and 50 percent. This process should be continued. “The more competitive we become, the more we focus on the price issue,” says Kroetz. He wants to sharpen things further with short social media spots, all of which are aimed at the price, the digital experience and the speed of contract conclusion and service.

Customer ratings significantly improved

The sometimes very negative customer feedback is now a thing of the past. On the Trustpilot rating portal, Allianz Direct now ranks high with 4.5 out of a possible five stars. In the first few months after launch, the result was just over one star. “Customer ratings are extremely important to us,” says Philipp Kroetz. Once a week, he and his team evaluate reactions online.

The reason is clear: those who offer their products on the Internet must also closely monitor the reactions to them. However, the Allianz Direct boss does not want to change one thing: Customers who call the group’s own service center in Halle an der Saale will continue to be consistently addressed on a first-name basis. This initially caused astonishment in some places, but has meanwhile become established apart from a few negative reactions.

Usain Bolt also helped with the change process, not only as motivating graffiti at the loft entrance. The Jamaican, whom many experts consider to be the best and best-paid sprinter of all time, visited almost all Allianz Direct locations in September. The question was: what does competitiveness mean for someone who has already won so many Olympic medals? Bolt had eight gold between 2008 and 2016.

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