The Flanders-China Chamber of Commerce (FCCC), with the support of Flanders Investment & Trade, organized an exclusive meeting with Mr. Filip Coremans, Managing Director Asia of Ageas and Vice-Chairman of the FCCC. During this meeting, Mr. Coremans shared the experiences and future prospects of Ageas in China. The webinar took place on October 14, 2021.
Ms Gwenn Sonck, Executive Director of the Flanders-China Chamber of Commerce, welcomed the participants to the webinar.
Mr Filip Coremans, Managing Director Asia, Ageas, started with an overview of the history of the company. Ageas and its predecessors have two centuries of experience. In 1824, AG Life was set up in Belgium. In 1990 it became part of the Belgo-Dutch insurance group Fortis, laying the foundations of the bancassurance model. In 2008 Fortis sold its banking activities and became a pure insurance player, creating the Ageas brand in 2010. Ageas is an international insurer with a local identity. It is a BEL-listed company with 45,000 employees and 39 million customers. It is a Top-20 insurer in Europe with €36 billion gross inflow. Ageas' focus is on Europe and Asia. The company can boost of 20 years of value creation in Asia with four segments of activities with a solid performance.
Since 2001, net investments into Asia amounted to €579 million. The company's contribution to Asia is fast growing with partnerships in nine markets: China, India, Malaysia, Thailand, Vietnam, the Philippines, Singapore, Laos and Cambodia. It is the sixth largest life insurer in China. By 2024, the Asian share of net results is expected to increase to around 50%.
In China, Ageas formed a partnership with the state-owned enterprise China Taiping in 2001. Taiping Life went from a greenfield start in November 2001, with 250 employees, 500 agents and four offices in four cities to more than 19,000 employees, more than 370,000 agents, 1,400 branches and sales offices, and more than 24 million customers today. Since 2016 Taiping Life's premium inflows grew at a CAGR of 11% per annum, while the embedded value (EV) grew at 20% per annum. Ageas has by far the largest presence of foreign insurers in China, with a 24.9% stake in Taiping Life (TPL).
Partnerships are in Ageas' DNA. In all partnerships, Ageas strives to select the right partners; to be seen as a local insurer, not a foreign one; to focus on the strategic, not the tactical rationale; and to build on long term loyalty, not on financial return only. Ageas has governance board participations across Asia. It has two board members and one supervisor at Taiping Life; one board member at Taiping Re; and board memberships at Taiping Asset Management and Taiping Financial Service. Ageas' Group and regional offices act as “knowledge brokers”. The new role of Chief Development and Sustainability Officer at the Management Committee level will drive an enhanced level of knowledge transfer, innovation and synergy creation across the group.
Mr Coremans: We have to work extremely hard to stay effective. Partnerships are increasingly more important. I draw a parallel between partnership management and marriage. The mindset is that the partnership is forever. Some say that is because we are in insurance and therefore look at the long term. But that is not the only reason. It is a mindset of commitment that comes with the duty of care. Most people don't enter into a marriage with a limited time scope in mind. How do you select the right partner? How do you make it work? How do you sustain it after the honeymoon period? In finding the right partner, we focus on four things. In culture and values they do not have to be the same, but they need to be compatible. I highly recommend to study the cultures of the countries you are investing in. Read about religion, philosophy and history. A minimum investment in cultural training is required. It will dramatically improve communication. We provide this type of training to anyone on a mission to find new partners. Second is a joint obsession, something to get excited about. Third is not to control our partners. We don't focus on control. We want local companies which are responsible and responsive to local market needs. We try to empower, not restrict them. Finally, don't be greedy. Don't make your partner's account and don't focus on the immediate financial return. Both partners should focus on the value added in the long run. Parasitism and coercion will not work. When one partner is vegetating on the other one's efforts it will not last. You need to be an adaptive partner.
Very important in this context is also what I call the prenuptial agreement. You can't avoid having the hard talks up front. It would be wrong to avoid the difficult discussions because they are difficult. I also recommend not to leave it only to lawyers. You need very strong legal advice in this context, but it has to be local. Somebody in the organization needs to take the time to follow up in detail the commercial decisions that need to be taken. You can't do that from the sidelines. Also very important is how to stay attractive to your partner after the honeymoon period. To stay relevant to a partner is hard work. If today we still bank on our original value to our partner we would become irrelevant. This has nothing to do with loyalty. Complacency is a disaster for a relationship. You always need to think how to reinvent yourself, become even better and acquire new skills. Bring new innovations to the table. If both partners think like that the partnership becomes indestructible. At Ageas we set up a structure that is fully focussed on this. We learn from our partners and also leverage their strengths. You can be a teacher and a student at the same time and they will fully appreciate this in China.
You also need to constantly keep your finger on the pulse of the partner. Communication channels have to be wide open. Every year we do an Asia support framework review with all the partners, where we have a dialogue. We work out with them a plan of action of support. It is hard work, but it makes the difference. The dialogue should not only take place at the operational level, but at every level, mirroring the hierarchy of your partner. Communication, hard work and sharing, and reinventing yourself are very important.
In the beginning and the end it's all about people. Our country managers follow developments in their respective countries. Management positions regularly come up for review and should align with the need of the company. Influence is much more effective than control. On management participation, they need to be the best, not those that are immediately available.They are the most visible value that you can add. They should be responsible and accountable to the local leadership and the partnership, the best trusted advisors. In China it is also critically important to keep this in mind.
A Q&A session concluded the webinar.
