World Insurance Report 2009 reveals vital multi-distribution channels for capturing growth in a
challenging market: Transformation strategies can help insurers
February 5, 2009 - Many of the world’s insurance companies are moving toward
multi-distribution models, recognizing that the sale of insurance through multiple
distribution networks1 is a powerful lever for growth, especially in mature markets,
according to the World Insurance Report 2009 from Capgemini and the European
Financial Management and Marketing Association (EFMA).
The report’s findings draw on a survey of 2,250 distributors and in-depth interviews with 59
senior executives from leading global insurers. The report covers the retail insurance market,
including both non-life (including health) and life segments. The World Insurance Report 2009
reveals new insights on the attitudes distributors have toward multi-distribution, the influence
insurers have on those attitudes, the necessary steps to a multi-distribution model, and the
progress insurers are making in building and leveraging multi-distribution capabilities.
Multi-distribution has high potential as a growth lever
Multi-distribution is the most effective way for insurers to attract new customers and increase the
wallet share from existing customers. The average mature-market insurance customer holds 5.2
policies, but the average share of wallet for a single insurer is only 1.1 to 1.5 policies.
1 Networks are the intermediaries that distribute insurance products: Tied agents, multi-tied agents, direct and
alternative networks. Channels (or access points) are the methods or tools through which the customer interacts with
the network to research, purchase and manage their insurance policies.
According to Bertrand Lavayssière, Managing Director, Global Financial Services, Capgemini;
“Insurers face heightened competition from the increasingly complex web of intermediaries
(networks) and access points (channels) in retail markets. Given current market conditions,
multi-distribution offers insurers a way to retain and increase share-of-wallet more effectively
and face a highly competitive environment by managing networks and channels more
Multi-distribution can help insurers to generate additional revenues and improve network sales
productivity, since lead generation and management are more tailored to ‘value-creating’
relationships. As a result, cross-network cooperation can increase the sales conversion rate, and
therefore improve the sales productivity of networks – which consequently boosts revenues.
Even a few actions can quickly reduce resistance to multi-distribution and increase
For distributors multi-distribution can mean fiercer competition, so not all are enthusiasts.
Particularly in mature markets, traditional networks see new entrants and new distribution formats as
a potential threat to their market share and positioning.
Significantly, though, the report finds there are conflicting views among distributors about the
benefits of multi-distribution, and in particular network cooperation, even among those with the same
business model. Based on views of multi-distribution, the report categorized four sub-segments of
distributors: Very Enthusiastic (27 percent), Enthusiastic (29 percent), Resistant (31 percent) and
Very Resistant (13 percent). Notably, there was a relatively even spread of network type in each
group. The good news for insurers is that data show distributors are not inherently pre-disposed by
their business model to be pro or anti multi-distribution and their attitudes can be influenced to
reduce resistance and create real enthusiasm for multi-distribution.
In fact, the 2009 report shows various levers can quickly improve distributor attitudes to multidistribution.
Insurers can exert the most influence by dealing first with financial incentives, but
there is also significant benefit to dealing with certain issues related to the Internet, such as
convincing distributors the Internet will help them sell additional products to their customers.
That lever, when pulled in the correct sequence with others, would have increased the size of the
Very Enthusiastic segment by about 150 percent and decrease the Very Resistant segment by 50
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