Simplify to accelerate

Is insurance still a growth business? Why is insurance the sector with consistently lowest client trust levels? How can one successfully transform a $100bn revenue company? Those questions are on everyone’s minds in the industry. They are good questions. Let me try to address them.

To me, the next 20 years will be a new golden age for insurance. Why is that?

Insurance still answers a basic need in our economies and societies, even more so in a world that is becoming less predictable. New risks arise, linked to climate change - no need to elaborate - rising healthcare costs (3 times GDP growth!), cyber-security, new form of labor from the gig economy (over 150m independent workers in Europe and North America), that are creating more demand for protection. 

I see a growing gap between the new risks individuals and societies have to cope with. Insurance can bridge this protection gap. Our expertise is to build mutualized protection systems and recreate a sense of community and collectivity.

At the same time, however, I also realize that the industry as a whole does not always deliver the quality of service our customers should expect from us. We have never created the meaningful interactions and - let’s use the word - intimacy which would allow us to gain their trust. 

This mismatch between our purpose and what we actually deliver to our customers is an open door to competition. New digital entrants are starting to disrupt the insurance business. Thus far, they are doing it on simple products and niche market segments, but we should all feel energized by their relentless quest for simplicity and focus on what truly matters to the customer. Although they bring more simplicity and transparency, they have yet to solve the big conundrum in our business: how can we durably realign our interests with that of our customers?

This issue of realignment has fueled my vision for the industry and for AXA. I am convinced that in order to succeed, we have to move from payer to partner. We need to be the best at paying bills. But if we are only about that, I see limited future for our industry. Being a partner means knowing our customers very well and having more regular interactions with them. It means pursuing a common agenda with our customers. Luckily, on that front, we are 100% aligned with them. We have a genuine interest in reducing/preventing the risks faced by our customers and empowering them to live better, safer and healthier lives. 

Service is the real disruptor 

Today, out of 100 clients, 20 will have a claim in any single year, be in touch with their insurer and be reimbursed and taken care of. What about the remaining 80 clients, who do not claim? Good for them you might say. But every survey shows they are much less satisfied than those who unfortunately have had to face a claim. We cannot continue to contact these 80 customers only once a year, to collect their (sometimes increased) premium. 

We need to significantly improve our customer service for the 20 clients who need insurance coverage at some point. It is the role of our teams. Agents. Claims adjusters. Service platform. And technology is helping us progress dramatically. That’s what we set out to do a few weeks ago with fizzy, the first blockchain-based flight delay insurance contract ever created, which allows clients to be automatically reimbursed in case of flight delays. No more red tape, no more lengthy procedures, no more frustration. Simplicity and peace of mind. 

For the remaining 80 clients, we need to offer new protection services beyond claim, to create intimacy and contact with them. Our teleconsultation service is one strong example of that. Deployed in 5 countries and available 24/7, it allows 3 million customers in France to ask health questions and find the right doctor for the right health issue. In 60% of cases, a first teleconsultation closes with no need for a further visit to a physician. 

By finding the right combination of technology, partnerships with private and public players, and by changing the way we treat our customers, we can build great services to recreate trust and simplicity for our customers when they need insurance or might need it in the future. 

Delivering such a transformation agenda at AXA was a complex thing to do one year ago. How could we deliver one-fourth of this transformation agenda in such a big and complex company, and in an industry that has been stuck in inertia for such a long time?

To enable this transformation, as a CEO, I need to simplify our organization.

We want a simpler geographical footprint, focused on markets where we matter and can change our customers’ lives.

We want a simpler organization. We have delayered the organization, drastically reducing the distance between the cab driver who holds an insurance policy in Shanghai and the Group CEO. We have also empowered the local entities to accelerate their transformation and better respond to customer needs. 

We want to take less financial markets risks and refocus on "real life" risks: health, protection, commercial lines. One of the world most inspiring CEOs always says it’s day 1. It certainly is for us at AXA, strong from a very unique 30-year history, but ready to tackle this new challenge. Getting the group fit for this new golden age, with service as the opening key.

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