Triglav eyes fur­ther growth with health, life in­sur­ance in fo­cus, to ad­vance telem­at­ics so­lu­tions

Top 100 See - - Top 100 Insurers - By Nevena Krasteva

In 2015 Triglav Group posted an in­crease in pre­mi­ums. What were the main driv­ers be­hind this pos­i­tive per­for­mance? How do you plan to sus­tain growth in the long term?

In its strat­egy, the Triglav Group de­fined that the main em­pha­sis will be on the core in­sur­ance busi­ness, pay­ing spe­cial at­ten­tion to pen­sion and health in­sur­ance. Bear­ing this in mind, the sales ac­tiv­i­ties of all in­sur­ance com­pa­nies of the group are even more fo­cused on clients as well as on de­vel­op­ing and in­creas­ing the ef­fi­ciency and devel­op­ment of sales chan­nels. This is our com­pet­i­tive ad­van­tage in Slove­nia, and we are trans­fer­ring this prac­tice also to our mar­kets out­side Slove­nia. We ef­fec­tively achieve the set strate­gic ob­jec­tives, which re­flects in the busi­ness re­sults and – as you men­tioned – in pre­mium growth. More­over, we have made progress in the pen­sion in­sur­ance seg­ment, which is im­por­tant in terms of fu­ture growth, by tak­ing over Skupna poko­jnin­ska druzba, the se­cond largest provider of vol­un­tary pen­sion in­sur­ance in Slove­nia. Apart from that, we ef­fec­tively im­ple­ment the health in­sur­ance strat­egy in both the do­mes­tic and for­eign mar­kets.

Sat­is­fied clients will con­tinue to be our main con­cern and fo­cus of ac­tiv­i­ties. We will put em­pha­sis on the devel­op­ment of our ser­vices, the avail­abil­ity and di­ver­sity of sales chan­nels, which are in­creas­ingly sup­ported through on­line op­er­a­tions, and the strength­en­ing of the sales net­work on all mar­kets of the group. I ex­pect that dig­i­tal­i­sa­tion will be

Dig­i­tal­i­sa­tion will be one of the most im­por­tant fu­ture el­ments of suc­cess

one of the most im­por­tant fu­ture el­e­ments of suc­cess. Such an en­vi­ron­ment al­lows us not only to con­tin­u­ously im­prove our prod­uct range tai­lored to client needs but also to in­tro­duce mod­ern tech­nol­ogy so as to op­ti­mise busi­ness pro­cesses and pro­mote their trans­parency and sim­plic­ity, all of which keeps chang­ing our re­la­tion­ship with the clients and our busi­ness op­er­a­tions. We will con­tinue to de­velop in­no­va­tive so­lu­tions, which have been re­cently in­tro­duced. Par­tic­u­larly in co­op­er­a­tion with start-up and other in­no­va­tive com­pa­nies, we have been de­vel­op­ing ad­vanced so­lu­tions in telem­at­ics and trans­fer­ring them into prac­tice, in ad­di­tion to pro­mot­ing traf­fic safety, de­sign­ing ap­pli­ca­tions that send weather alerts and other.

Eco­nomic and fi­nan­cial con­di­tions in Slove­nia have im­proved and risks for Slove­nian in­sur­ers have di­min­ished but low in­ter­est rates pile pres­sure on bot­tom lines. How do you ex­pect Slove­nia's in­sur­ance sec­tor to per­form in this en­vi­ron­ment?

Like most in­sur­ance com­pa­nies world­wide, we have been fac­ing very chal­leng­ing con­di­tions on debt mar­kets for quite some time now. Ex­tremely low in­ter­est rates and in­creased volatility in fi­nan­cial mar­kets are the re­al­ity. Re­turns on fi­nan­cial in­stru­ments, debt in­stru­ments in par­tic­u­lar, in our port­fo­lios have dropped on av­er­age, which is ex­pected to last for some time. We an­tic­i­pated such a sit­u­a­tion and adapted our busi­ness plans ac­cord­ingly. We are aware of the re­spon­si­bil­ity and the fact that we man­age the as­sets used to cover the li­a­bil­i­ties of in­sur­ance op­er­a­tions, which is why in­vest­ment se­cu­rity will re­main our pri­mary goal. We will main­tain the ex­ist­ing rel­a­tively con­ser­va­tive in­vest­ment struc­ture of the Triglav Group with the em­pha­sis on fixed-rate investments, and we will con­tinue to in­vest on the fi­nan­cial mar­kets which en­sure ad­e­quate liq­uid­ity, di­ver­si­fi­ca­tion and the ex­pected re­turn.

Else­where in South­east Europe, what were the un­der­ly­ing trends that shaped the devel­op­ment of the in­sur­ance mar­ket and how will they af­fect Triglav's per­for­mance in 20162017?

The macroe­co­nomic con­di­tions on the in­sur­ance mar­kets in Croa­tia, Bos­nia and Herze­gov­ina, Mon­tene­gro, Ser­bia and Mace­do­nia, where the group op­er­ates, are im­prov­ing, how­ever their re­cov­ery is grad­ual and af­fects the in­sur­ance busi­ness with a cer­tain de­lay. Last year, pos­i­tive trends and pre­mium growth were seen on all the in­sur­ance mar­kets in which the group op­er­ates. The re­sults show that in to­tal writ­ten pre­mium non-life in­sur­ance is by far the largest seg­ment, the bulk of which is ac­counted for by motor ve­hi­cle in­sur­ance – life and non-life in­sur­ance are sold in most coun­tries, while only non­life in­sur­ance is sold in Mace­do­nia and, as of re­cently, health in­sur­ance. The life in­sur­ance mar­ket has con­tin­ued to in­crease grad­u­ally and con­sis­tently.

The coun­tries in which the group op­er­ates have ma­jor devel­op­ment po­ten­tial as they are in part rel­a­tively un­de­vel­oped. We are aware that we are op­er­at­ing in a highly com­pet­i­tive and de­mand­ing en­vi­ron­ment, in which speci­fici­ties of in­di­vid­ual in­sur­ance mar­kets play an im­por­tant role. We con­tin­u­ously strive to trans­fer the good prac­tice from Slove­nia to our sub­sidiaries abroad, which are man­aged by the hold­ing com­pany TINT (Triglav INT). In the mar­kets where the group holds a high mar­ket share and a lead­ing po­si­tion, the con­sol­i­da­tion strat­egy has been and will con­tinue to be pur­sued, whilst on the re­main­ing mar­kets, where the group's pres­ence is still be­ing built, fo­cus has been and will be on strength­en­ing the group's mar­ket po­si­tion. In all mar­kets, we will strive to take full ad­van­tage of both the strength of the Triglav brand and the com­par­a­tive ad­van­tages of the Triglav Group, to en­sure long-term re­turn on in­vested as­sets and to in­crease pro­duc­tiv­ity through syn­er­gis­tic ef­fects, while com­ply­ing with the lo­cal leg­is­la­tion and tak­ing into ac­count the risks.

In which seg­ments and prod­uct cat­e­gories do you see growth op­por­tu­ni­ties – both in Slove­nia and in South­east Europe?

Each of the six coun­tries in the Adria re­gion where the Triglav Group op­er­ates has some speci­fici­ties, which in­di­vid­ual in­sur­ance sub­sidiaries of the group take into ac­count to de­fine their strate­gic guide­lines and busi­ness plans. In the long run, I see growth po­ten­tial on the health, life and pen­sion in­sur­ance mar­kets both in Slove­nia and in the re­gion. We are very pleased that by ac­quir­ing the se­cond largest Slove­nian provider of vol­un­tary pen­sion in­sur­ance the group consolidated its pres­ence on the Slove­nian mar­ket, where around 83% of the group's to­tal writ­ten pre­mium is booked. This en­ables us to be even more ac­tive on the pen­sion in­sur­ance mar­ket. Due to the rel­a­tively un­der­de­vel­oped pen­sion sys­tem in Slove­nia and the in­creas­ingly un­favourable age struc­ture of the pop­u­la­tion, I be­lieve that we can ex­pect fur­ther pres­sures on the Slove­nian public pen­sion sys­tem and con­se­quently the need to strengthen the se­cond pen­sion pil­lar. The growth rate of the said mar­ket will de­pend on the dy­nam­ics of changes to the ex­ist­ing pen­sion sys­tem, while the in­creased pres­ence on the Slove­nian pen­sion mar­ket will af­fect fu­ture con­sol­i­da­tion of the group's po­si­tion in the life in­sur­ance seg­ment (pen­sion an­nu­ities). The mar­kets of South­east Europe rep­re­sent fore­most po­ten­tial growth in the non-life in­sur­ance seg­ment, ex­clud­ing motor ve­hi­cle in­sur­ance, and various life and health in­sur­ance classes.

Last year and the be­gin­ning of 2016 saw some ma­jor ac­qui­si­tions on the in­sur­ance mar­kets in South­east Europe, in­clud­ing Triglav's deal for Skupna poko­jnin­ska druzba. Do you see fur­ther room for con­sol­i­da­tion?

The in­sur­ance mar­kets in this re­gion, from Croa­tia to Mace­do­nia, have po­ten­tial for growth. In line with our strate­gic guide­line, the Triglav Group will con­tinue to con­sol­i­date its po­si­tion in the re­gion and to de­velop as the in­sur­ance hub of South­east Europe. Our goal is to fur­ther grow on these mar­kets, pri­mar­ily through or­ganic growth, how­ever we do not rule out po­ten­tial takeovers should an ap­pro­pri­ate op­por­tu­nity arise. There­fore, we will con­tinue to strengthen and con­sol­i­date the group's po­si­tion out­side Slove­nia, while the ac­tiv­i­ties aimed at achiev­ing growth and devel­op­ment will be pru­dent and fo­cused on in­creas­ing the group's value in the long term.

Triglav Group is present in 6 coun­tries and 7 mar­kets

Ben­jamin Josar, mem­ber of the man­age­ment board

Slove­nian in­sur­ance com­pany Zavaroval­nica Triglav, set up in 1990, is the con­trol­ling com­pany of Triglav Group. Triglav Group posted a consolidated net profit of 88.9 mil­lion euro in 2015, up 4% from a year ear­lier. Gross writ­ten pre­mi­ums from in­sur­ance and co-in­sur­ance grew 3% to 919.1 mil­lion euro in 2015. The group, listed on the Ljubl­jana Stock Ex­change, is ac­tive in Slove­nia, Croa­tia, Bos­nia and Herze­gov­ina, Ser­bia, Mon­tene­gro, and Mace­do­nia.

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