Keeping up with the market – April 2022

Every month we help you keep up with the Belgian and Luxembourg insurance market.

Mergers & Buy-out

 

AGEAS  & AFLIC

Ageas has increased its stake in Indian insurer Ageas Federal Life Insurance Company (AFLIC) from 49% to 74%. As a result, Ageas has taken control  by acquiring a majority stake. With 26%, Federal Bank is the only other shareholder.

In India, Ageas’ activities include both life and non-life insurance.

 

AXA & BANCO BPM

 

AXA SA intends to buy a controlling stake in Italy’s third largest bank Banco BPM’s insurance units. Apparently, the discussion has started between the two parties and buying the majority stake would cost around €1.5 billion.

According to some anonymous source, AXA is waiting for Banco BPM to take full ownership of several insurance businesses. They also said that another element to take into account is the fact that Credit Agricole SA recently bought a stake in Banco BPM, which could discourage potential competitors. So far, no representatives for the 3 companies respectively accepted to make a comment.

 

Partnership and Products

 

NN & RECORD CREDITS

  

Life insurer NN and the Belgian broker Record Credits have been working together since 2011. This month, both parties announced they are extending their partnership for another five years.

This alliance allows NN to keep on relying on its network of 650 independent credit brokers for the distribution of its outstanding balance insurance policies. For its part, Record Credits can offer more attractive rates on home loans to its clients when they opt for this type of insurance policy.

 

MUNICHE RE & ONEDEGREE

 

Reinsurer Munich Re decided to partner with OneDegree, a Hong Kong-based insurtech, to insure NFTs and develop offerings that cover digital assets.

The explosion of the crypto phenomenon led to a three-year partnership between the two companies, coming up with a groundbreaking solution: OneInfinity. It is designed for digital trading platforms, custodians, asset managers and technology providers.

As part of the deal, Munich Re will provide reinsurance capacity and technical underwriting support for OneDegree and the latter will become the first licensed insurer in Asia to collaborate with a world-class reinsurer offering this type of coverage.

 

ALLIANZ

Allianz launches Allianz MeHomeLoans, a new mortgage loan in Belgium. These loans are financed by the challenger bank MeDirect, one of Allianz’s partners. This innovative product will have a flexible configuration combined with a transparent price, which quickly adapts to market demand and creates new opportunities for people who want to acquire a home.

Tim Rooney, CEO of MeDirect, the bank behind MeHomeLoans, declared “We are excited to collaborate with Allianz and offer our innovative products to Allianz’s extensive network of mortgage and insurance brokers.” For Allianz, Kathleen Van den Eynde, CEO of Allianz Belgium, declared “Through this unique offering, we intend to strengthen our position as a lender in the Belgian mortgage market. The modern technology and scalability of the Allianz MeHomeLoans joint proposal is perfectly in line with our strategy to support the broker network in digital customer services.

This new offering entered the Belgian mortgage market in the first quarter of 2022 through Allianz’s network of independent brokers.

 

SWITCH

The store chain Switch (Apple) will no longer sell insurance for digital equipment.

This is due to FSMA’s decision on 2 March 2022 to prohibit Switch Holding NV from marketing those insurance products on Belgian territory. In various sales outlets, inspectors observed the non-compliance with certain legal or regulatory provisions, particularly regarding customer information and rules of conduct.

Therefore, the FSMA has taken note of Switch Holding SA’s renunciation of its registration in the register of insurance intermediaries, with effect from 25 March 2022.

 

WTW

Willis Towers Watson (WTW) has just released an update of its pricing tool, the Radar software. Open-source software Python has been fully integrated to the new version: Radar 4.14. Thanks to this upgrade, it will be easier for insurers who will have access to a sophisticated environment combining advanced pricing capabilities with the powerful Python.

Indeed, working practices among insurers have substantially changed with the sanitary crisis. Consequently, analytical methods intensified, as well as the need to adjust quickly to market shocks and processes automation. In addition, the pressure on insurers to include governance and security controls in their pricing capabilities has also increased.

According to Serhat Guven, Managing Director at WTW, “Radar technology has always led the market in its ability to develop and deploy complex rating algorithms with ease and at speed, supported by a transparent and sophisticated governance capability.”

 

News of the market

 

VIVIUM DIGITAL AWARDS

The winners of the Vivium Digital Awards 2022

This year was the third Vivium Digital Awards ceremony. The Vivium Digital Awards jury awarded 6 Belgian insurtechs with the ‘leader’ label. This means that they are at the top of their field, according to the Vivium Digital Awards jury.

In the field of ‘life insurance’, Harmoney, Harukey and myFaro were awarded. For the ‘non-life insurance’, WeGroup, with its virtual office assistant Louise, and the WIS tool received an award.

As for the ‘customer interaction’ category, Penbox also won the ‘leader’ label .The company was also chosen by brokers as the largest gamechanger of 2022 and received also the Broker Award.

 

BeNeverMede FUND: ASSURE YOUR FUTURE

  

For the 5th time, the Benevermedex Fund, ‘Assure Yor Future‘, will grant a prize of 3,500 euros in collaboration with the King Roi Baudouin Foundation. The award will be attributed to an original scientific work on the prevention of human damage in the field of private insurance that resulted in the successful defense of a thesis at a university in the Dutch Region during the period from 1 October 2021 to 30 September 2022.

Established in 2017, the Benevermedex Fund was created  within the Dutch-speaking Belgian Association of Insurance Consultants and Medical Experts to improve the prevention, assessment, compensation and quality of life of the many accident victims through support for scientific research. It is managed by the King Baudouin Foundation with the financial support of Assuralia.

You can read more about the project submission on the following website: www.benevermedex.be

 

SOLIDARIZED PENSION FUND

Belgium established the “Solidarized Pension Fund”* on 1 January 2012 to provide sustainable funding for the pensions of affiliated local government employees who are appointed permanently. At the time, the Solidarized Fund grouped together several pension financing formulas (Pool 1, Pool 2, Pool 3, police zones, etc.).

In 2021, the Court of Auditors** denounced the fact that, in this view, the pension burden was increasing too fast in relation to the contributions paid by the affiliated local authorities. In response, the Minister declared that a reform was underway.

Some of these measures have already been adopted but others are still being processed. Here is a listing of the adopted measures:

  • the basic pension contribution rate has been raised to 44% for the year 2023 (from 43% for the year 2023)
  • the Pool 1 Reserve Fund will contribute to the pension costs of local authorities formerly affiliated to Pool 1 for the year 2023

On 21 April 2022, a new bill was introduced in the House with the aim to reform rules regarding the pension burden borne by the “Solidarized Pension Fund” in the event of the dissolution or disappearance of a local authority (merger, transfer, etc.). This would ensure that the pension burden of the concerned agents would still be financed.

Finally, other measures are expected, especially regarding the strengthening of solidarity within the Solidarized Fund.

*Fond de pension solidarisé/Gesolidariseerd pensioenfonds

**Cours des Comptes /Belgische Rekenhof

 

 

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